BUSINESS
185323959-Business-Stats-Ken-Black-Case-Answers.pdf

From april through august seasonal indices are more

Info icon This preview shows pages 46–50. Sign up to view the full content.

From April through August, seasonal indices are more than 100 peaking in the summer months of June, July, and August. This would indicate that these are the strongest months of locker sales. This might make sense because schools might be purchasing lockers and installing them in the summertime in preparation for the opening of school. The months of October, November, and December have low seasonal indexes. The upward trend marks good news for DeBourgh demonstrating a consistent growth. The seasonal indices can be used to help DeBourgh plan for both production and shipping. By examining lead time and production times, DeBourgh can more closely schedule raw materials from suppliers and do human resource planning. 2. Using MINITAB, several forecasting techniques were explored. Three different moving averages were used. These were unweighted moving averages of 4 years, 3 years, and 2 years producing MADs of 5.1825, 5.2461, and 4.0717. The 2-year moving average produced the least MAD and seemed to make the best fit. The MINITAB graphical output for the 2-year moving average model is shown below. Next, single exponential smoothing models were examined with various values of α . For α = .3, the MAD was 7.3010. For α = .6, MAD was 7.0447. For α = .9, MAD was 3.6254. Thus, the higher the value of alpha, the better the forecast with a big improvement as alpha moved from .6 to .9. Since alpha weights the actual previous value, the exponential smoothing works better here when the model actually shadows the previous value. Since there seems to be a downward overall trend in the data, tracking the previous value may be a good strategy. An optimal search for alpha resulted in an alpha of .987. The value of MAD for this model was 2.9569. The MINITAB graphical output for this optimal value of alpha is shown below. Trend analysis was preformed on these data by fitting a line through the data. MINITAB trend analysis resulted in MAD of 4.7155. A quadratic fit resulted in MAD = 2.8426.
Image of page 46

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

Case Notes 47 Overall, the best fitting model to these data was the quadratic trend analysis model. The model produced by this analysis is 91.6691 - 6.21916 t + 0.266113 t 2 . Using t = 15 to represent the year 2002, the predicted per-unit labor cost is: 91.6691 - 6.21916(15) + 0.266113 (15) 2 = 58.26. Shown below is the graphical analysis for the quadratic trend model produced using MINITAB. DeBourgh can become more productive and produce better quality lockers by reducing costs (particularly those do to poor work, scrap, rework, poor raw materials, etc.). Actual Predicted Actual Predicted 0 5 10 15 55 65 75 85 Cost Time Moving Average Length: MAPE: MAD: MSD: 2 6.4362 4.0717 51.6762 Moving Average
Image of page 47
Case Notes 48 Actual Predicted Actual Predicted 15 10 5 0 85 75 65 55 Labor Cost Time MSD: MAD: MAPE: Alpha: Smoothing Constant 37.2189 2.9569 4.6176 0.987 Single Exponential Smoothing Actual Fits Actual Fits 15 10 5 0 85 75 65 55 Labor Cost Time Yt = 91.6691 - 6.21916*t + 0.266113*t**2 MSD: MAD: MAPE: 16.7767 2.8426 3.9710 Trend Analysis for Labor Cost Quadratic Trend Model
Image of page 48

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

Case Notes 49 Chapter 17 Schwinn 1. Since two independent samples are being compared and the shape of the population distribution is unknown, the Mann-Whitney U test is used to analyze the data rather than the t test for two independent samples.
Image of page 49
Image of page 50
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern