Project 11 $\quad$ $\quad$ $\quad$ $\quad$ $\quad$

question 19

Essay

Project 11.1  Developing and Assessing Forecasts at Dempsi Industries
Management at Dempsi Industries is unsure about how to calculate demand for the next four weeks. They have collected demand data for the last year and have presented you with the data. They have asked you for a reasonable level of demand for the next four weeks. You have agreed to provide management a report describing your analysis.
Conduct an analysis of the data provided. Based on the sample data and your initial analyses, evaluate the applicability of the forecasting techniques covered in the chapter. For each technique, provide a brief description of the technique and an assessment of the appropriateness of that technique to the sample data. Provide a table summarizing the forecast error evaluations for each technique examined. Recommend a technique to use to make the requisite predictions and provide a prediction of demand for the next four weeks based on this recommended model.
$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text { Demand for Demps1 Industries Product } A$
$\begin{array}{cccccccc}\hline \text { Week } & \text { Demand } & \text { Week } & \text { Demand } & \text { Week } & \text { Demand } & \text { Week } & \text { Demand } \\\hline 1 & 410 & 15 & 463 & 29 & 332 & 43 & 434 \\2 & 229 & 16 & 393 & 30 & 412 & 44 & 297 \\3 & 344 & 17 & 427 & 31 & 332 & 45 & 523 \\4 & 278 & 18 & 381 & 32 & 261 & 46 & 381 \\5 & 293 & 19 & 359 & 33 & 255 & 47 & 487 \\6 & 395 & 20 & 516 & 34 & 381 & 48 & 409 \\7 & 449 & 21 & 191 & 35 & 382 & 49 & 260 \\8 & 436 & 22 & 446 & 36 & 217 & 50 & 392 \\9 & 448 & 23 & 555 & 37 & 431 & 51 & 474 \\10 & 347 & 24 & 628 & 38 & 292 & 52 & 468 \\11 & 523 & 25 & 277 & 39 & 286 & & \\12 & 245 & 26 & 549 & 40 & 278 & & \\13 & 266 & 27 & 354 & 41 & 393 & &\end{array}$

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Definitions:

Expected Inflation Rate

The anticipated rate at which the general level of prices for goods and services will rise over a period.

Velocity of Money

The rate at which money circulates in the economy, typically measured as the ratio of nominal GDP to the money supply.

Actual Inflation Rate

The rate at which the general level of prices for goods and services is rising, and, subsequently, purchasing power is falling, as measured over a specific period of time.

Actual Price Level

The current cost of goods and services in an economy, affecting purchasing power and inflation rates.