Overview of Quantitative Approaches

Overview of Quantitative Approaches - þ Sometimes cost...

Info iconThis preview shows pages 1–8. Sign up to view the full content.

View Full Document Right Arrow Icon
1 Overview of Quantitative Approaches Time Series Naive approach Moving averages Exponential smoothing Trend projection Linear regression Associate Regression
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 þ Set of evenly spaced numerical data þ Obtained by observing response variable at regular time periods þ Forecast based only on past values þ Assumes that factors influencing past and present will continue influence in future Time Series Forecasting
Background image of page 2
3 Trend Seasonal Cyclical Random Time Series Components
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4 Components of Demand Demand for product or service | | | | 1 2 3 4 Year Average demand over four years Seasonal peaks Trend component Actual demand Random variation Figure 4.1
Background image of page 4
5 Naive Approach þ Assumes demand in next period is the same as demand in most recent period þ e.g., If May sales were 48, then June sales will be 48
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 6
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 8
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: þ Sometimes cost effective and efficient 6 þ MA is a series of arithmetic means þ Used if little or no trend þ Used often for smoothing þ Provides overall impression of data over time Moving Average Method Moving average = ∑ demand in previous n periods n 7 January 10 February 12 March 13 April 16 May 19 June 23 July 26 Actual 3-Month Month Shed Sales Moving Average (12 + 13 + 16)/3 = 13 2/3 (13 + 16 + 19)/3 = 16 (16 + 19 + 23)/3 = 19 1/3 Moving Average Example (10 + 12 + 13)/3 = 11 2/3 8 Graph of Moving Average | | | | | | | | | | | | J F M A M J J A S O N D Shed Sales 30 – 28 – 26 – 24 – 22 – 20 – 18 – 16 – 14 – 12 – 10 – Actual Sales Moving Average Forecast...
View Full Document

This note was uploaded on 01/20/2012 for the course MGT 3200 taught by Professor Moodie during the Spring '08 term at Kennesaw.

Page1 / 8

Overview of Quantitative Approaches - þ Sometimes cost...

This preview shows document pages 1 - 8. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online