Create a Double Moving Average model (with k 5 4) for the data set. a. Prepare a line graph comparing the Double Moving Average predictions against the original data. b. What are the forecasts for the next 2 months using this technique?
> Dr. Sarah Benson is an ophthalmologist who, in addition to prescribing glasses and contact lenses, performs optical laser surgery to correct nearsightedness. This surgery is fairly easy and inexpensive to perform. Thus, it represents a potential gold min
> For investment advisors, a major consideration in planning for a client in retirement is the determination of a withdrawal amount that will provide the client with the funds necessary to maintain his or her desired standard of living throughout the clien
> The owner of a local car dealership has just received a call from a regional distributor stating that a $5,000 bonus will be awarded if the owner’s dealership sells at least 10 new cars next Saturday. On an average Saturday, this dealership has 75 potent
> Executives at Meds-R-Us have decided to build a new production facility for the company’s bestselling high blood pressure drug. The problem they now face is determining the size of the facility (in terms of production capacity). Last year, the company so
> Refer to the Hungry Dawg Restaurant example presented in this chapter. Health claim costs actually tend to be seasonal, with higher levels of claims occurring during the summer months (when kids are out of school and more likely to injure themselves) and
> Vinton Auto Insurance is trying to decide how much money to keep in liquid assets to cover insurance claims. In the past, the company held some of the premiums it received ini interestbearing checking accounts and put the rest into investments that are n
> Bob Davidson owns a newsstand outside the Waterston office building complex in Atlanta, near Hartsfield International Airport. He buys his papers wholesale at $0.50 per paper and sells them for $0.75. Bob wonders what is the optimal number of papers to o
> Podcessories manufacture several accessories for a popular digital music player. The company is trying to decide whether to discontinue one of the items in this product line. Discontinuing the item would save the company $600,000 in fixed costs (comprise
> Sammy Slick works for a company that allows him to contribute up to 10% of his earnings into a tax-deferred savings plan. The company matches a portion of the contributions its employees make based on the organization’s financial performance. Although th
> Road Racer Sports, Inc. is a mail-order business dedicated to the running enthusiast. The company sends out full-color catalogs several times a year to several hundred thousand people on its mailing list. Production and mailing costs are fairly expensive
> After spending 10 years as an assistant manager for a large restaurant chain, Ray Clark has decided to become his own boss. The owner of a local submarine sandwich store wants to sell the store to Ray for $65,000 to be paid in installments of $13,000 in
> Techs burg, Inc. uses a stamping machine to manufacture aluminum bodies for lightweight, miniature aircraft used for military reconnaissance. Currently, forms in the stamping machine are changed after every 65 hours of operation or whenever a form breaks
> Fiasco Foods, Inc. is one of the largest suppliers of institutional and commercial food products in the United States. Fortunately for Fiasco, the demand for “food away from home” has been growing steadily over the pas
> Representatives from the American Heart Association are planning to go door-to-door throughout a community, soliciting contributions. From past experience, they know that when someone answers the door, 80% of the time it is a female and 20% of the time i
> Acme Equipment Company is considering the development of a new machine that would be marketed to tire manufacturers. Research and development costs for the project are expected to be about $4 million but could vary between $3 and $6 million. The market l
> Employees of Georgia-Atlantic are permitted to contribute a portion of their earnings (in increments of $500) to a flexible spending account from which they can pay medical expenses not covered by the company’s health insurance program. Contributions to
> The graph of the probability distribution of a normally distributed random variable with a mean of 20 and standard deviation of 1.5 is shown in Figure 12.5. The Excel function: also returns randomly generated observations from this distribution. a. Use
> Lynn Price recently completed her MBA and accepted a job with an electronics manufacturing company. Although she likes her job, she is also looking forward to retiring one day. To ensure that her retirement is comfortable, Lynn intends to invest $3,000 o
> The Harriet Hotel in downtown Boston has 100 rooms that rent for $150 per night. It costs the hotel $30 per room in variable costs (cleaning, bathroom items, etc.) each night a room is occupied. For each reservation accepted, there is a 5% chance that th
> The manager of Moore’s Catalog Showroom is trying to predict how much revenue will be generated by each major department in the store during the next year. The manager has estimated the minimum and maximum growth rates possible for reve
> The monthly demand for the latest computer at Newland Computers follows a normal distribution with a mean of 350 and standard deviation of 75. Newland purchases these computers for $1,200 and sells them for $2,300. It costs the company $100 to place an o
> Large Lots is planning a seven-day promotion on a discontinued model of 310 color television sets. At a price of $575 per set, the daily demand for this type of TV has been estimated as follows: Large Lots can order up to 50 of these TVs from a surplus
> The owner of a golf shop in Myrtle Beach, SC must decide how many sets of beginner golf clubs to order for the coming tourist season. Demand for golf clubs is random but follows a Poisson distribution with the average demand rates indicated in the follow
> Tarrows, Pearson, Foster, and Zuligar (TPF&Z) is one of the largest actuarial consulting firms in the United States. In addition to providing its clients with expert advice on executive compensation programs and employee benefits programs, TPF&Z
> The owner of a ski apparel store in Winter Park, CO must make a decision in July regarding the number of ski jackets to order for the following ski season. Each ski jacket costs $54 and can be sold during the ski season for $145. Any unsold jackets at th
> WVTU is a television station that has 20 thirty-second advertising slots during their regularly scheduled programming each evening. The station is now selling advertising for the first few days in November. They could sell all the slots immediately for $
> Hometown Insurance sells 10-year annuities to retirees who are looking for stable sources of investment income. Hometown invests the annuity funds it receives in an equity index fund with annual returns that are normally distributed with a mean of 9% and
> Branch banks must keep enough money on hand to satisfy customers’ cash demands. Suppose that the daily demand for cash at a branch of University Bank follows a lognormal distribution with means and standard deviation summarized as follo
> Under what condition(s) is it appropriate to use simulation to analyze a model? That is, what characteristics should a model possess in order for simulation to be used?
> Use Holt’s method to create a model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from Holt’s method versus the
> Create an exponential smoothing model that minimizes the MSE for the data set. Use Solver to determine the optimal value of a. a. What is the optimal value of a? b. Prepare a line graph comparing the exponential smoothing predictions against the origi
> Create a double moving average model (with k 5 4) for the data set. a. Prepare a line graph comparing the double moving average predictions against the original data. b. What are the forecasts for the next 2 years using this technique?
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> Use Holt-Winter’s multiplicative method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the pr
> Mac Brown knew something had to change. As the new Vice President of Sales & Marketing for the PB Chemical Company, Mac understood that when you sell a commodity product, where there is minimal difference between the quality and price, customer service a
> Use Solver to determine the weights for a three-period weighted moving average that minimizes the MSE for the data set. a. What are the optimal values for the weights? b. Prepare a line graph comparing the weighted moving average predictions against the
> Use Holt-Winter’s additive method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the predicti
> Use the multiplicative seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against
> Use the additive seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against the or
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> Use Holt-Winter’s multiplicative method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the pr
> Use Holt-Winter’s additive method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the predicti
> Use the multiplicative seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against
> Use the additive seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against the or
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> A used-car broker needs to transport his inventory of cars from locations 1 and 2 in Figure 5.39 to used-car auctions being held at locations 4 and 5. The costs of transporting cars along each of the routes are indicated on the arcs. The trucks used to c
> Use regression to estimate the parameters of a 6th order polynomial model for this data. That is, estimate the least squares estimates for the parameters in the following estimated regression equation: a. What are the optimal values of b0, b1, â
> Compute the two-period and four-period moving average predictions for the data set. a. Prepare a line graph comparing the moving average predictions against the original data. b. Do the moving averages tend to overestimate or underestimate the actual da
> Use Holt’s method to create a model that minimizes the MSE for the data set. Use Solver to estimate the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from Holt’s method against the
> Create an exponential smoothing model that minimizes the MSE for the data set. Use Solver to estimate the optimal value of a. a. What is the optimal value of a? b. Prepare a line graph comparing the exponential smoothing predictions against the original
> Use Solver to determine the weights for a four-period weighted moving average on the data set that minimizes the MSE. a. What are the optimal values for the weights? b. Prepare a line graph comparing the weighted moving average predictions against the or
> Compute the two-period and four-period moving average predictions for the data set. a. Prepare a line graph comparing the moving average predictions against the original data. b. Compute the MSE for each of the two moving averages. Which appears to provi
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> Use regression analysis to answer the following questions. a. Fit a linear trend model to the data set. What is the estimated regression function? b. Interpret the R2 value for your model. c. Prepare a line graph comparing the linear trend predictions ag
> Use Holt’s method to create a model that minimizes the MSE for the data set. Use Solver to estimate the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from Holt’s method against the
> In the wake of the Enron scandal two public accounting firms, Oscar Anderson (OA) and TriceMilkhouse -Loopers (TML), merged (forming OATML) and are reviewing their methods for detecting management fraud during audits. The two firms had each developed the
> Create a Double Moving Average model (with k 5 4) for the data set. a. Prepare a line graph comparing the Double Moving Average predictions against the original data. b. What are the forecasts for the next 4 months using this technique?
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> Use Holt-Winter’s multiplicative method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the pr
> Use Holt-Winter’s additive method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the predicti
> Use Holt’s method to create a model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from Holt’s method against th
> Use regression analysis to fit a quadratic trend model to the data set. a. What is the estimated regression function? b. Compare the adjusted-R2 value for this model to that of the linear trend model. What is implied by this comparison? c. Prepare a line
> Use regression analysis to fit a linear trend model to the data set. a. What is the estimated regression function? b. Interpret the R2 value for your model. c. Prepare a line graph comparing the linear trend predictions against the original data. d. Wha
> Use Holt’s method to create a model that minimizes the MSE for the data set. Use Solver to estimate the optimal values of a and b. a. What are the optimal values of a and b? b. Are these values surprising? Why or why not? Questions 35 through 39 refer to
> Create an exponential smoothing model that minimizes the MSE for the data set. Use Solver to estimate the optimal value of a. a. What is the optimal value of a? b. Prepare a line graph comparing the exponential smoothing predictions against the original
> A company has three warehouses that supply four stores with a given product. Each warehouse has 30 units of the product. Stores 1, 2, 3, and 4 require 20, 25, 30, and 35 units of the product, respectively. The per unit shipping costs from each warehouse
> Use Solver to determine the weights for a four-period weighted moving average on the data set that minimizes the MSE. a. What are the optimal values for the weights? b. Prepare a line graph comparing the weighted moving average predictions against the or
> Compute the two-period and four-period moving average predictions for the data set. a. Prepare a line graph comparing the moving average predictions against the original data. b. Compute the MSE for each of the two moving averages. Which appears to prov
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> Each month, Joe’s Auto Parts uses exponential smoothing (with a 5 0.25) to predict the number of cans of brake fluid that will be sold during the next month. In June, Joe forecast that he would sell 37 cans of brake fluid during July. Joe actually sold 4
> Use regression analysis to fit an additive seasonal model with linear trend to the data set. a. What is the estimated regression function? b. Interpret the R2 value for your model. c. Interpret the parameter estimates corresponding to the indicator varia
> Use Holt-Winter’s multiplicative method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the pr
> Use Holt-Winter’s additive method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the predicti
> Use Holt’s method to create a model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from Holt’s method against th
> Use the multiplicative seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against
> Use the additive seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against the or
> Nolan Banks is an auditor for the Public Service Commission for the state of Georgia. The Public Service Commission is a government agency responsible for ensuring that utility companies throughout the state manage their operations efficiently so that th
> Baldwin Enterprises is a large manufacturing company with operations and sales divisions located in the United States and several other countries. The CFO of the organization is concerned about the amount of money Baldwin has been paying in transaction c
> Use regression analysis to fit a quadratic trend model to the data set. a. What is the estimated regression function? b. Compare the adjusted-R2 value for this model to that of the linear trend model. What is implied by this comparison? c. Prepare a line
> Use regression analysis to fit a linear trend model to the data set. a. What is the estimated regression function? b. Interpret the R2 value for your model. c. Prepare a line graph comparing the linear trend predictions against the original data. d. Wha
> Use regression analysis to fit an additive seasonal model with linear trend to the data set. a. What is the estimated regression function? b. Interpret the R2 value for your model. c. Interpret the parameter estimates corresponding to the indicator varia
> Use Holt-Winter’s multiplicative method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the p
> A manufacturing company uses a certain type of steel rod in one of its products. The design specifications for this rod indicate that it must be between 0.353 and 0.357 inches in diameter. The machine that manufactures these rods is set up to produce the
> Use Holt-Winter’s additive method to create a seasonal model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a, b, and g. a. What are the optimal values of a, b, and g? b. Prepare a line graph comparing the predicti
> Use the multiplicative seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against
> Use the additive seasonal technique for stationary data to model the data. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from this method against the or
> Use regression analysis to fit a quadratic trend model to the data set. a. What is the estimated regression function? b. Compare the adjusted-R2 value for this model to that of the linear trend model. What is implied by this comparison? c. Prepare a line
> Use regression analysis to fit a linear trend model to the data set. a. What is the estimated regression function? b. Interpret the R2 value for your model. c. Prepare a line graph comparing the linear trend predictions against the original data. d. Wha
> Use Solver to create a Sensitivity Report for question 22 at the end of Chapter 3 and answer the following questions: a. Which of the constraints in the problem are binding? b. If the company was going to eliminate one of its products, which should it be
> Use regression analysis to answer the following questions. a. Fit a linear trend model to the data set. What is the estimated regression function? b. Interpret the R2value for your model. c. Prepare a line graph comparing the linear trend predictions aga
> Use Holt’s method to create a model that minimizes the MSE for the data set. Use Solver to determine the optimal values of a and b. a. What are the optimal values of a and b? b. Prepare a line graph comparing the predictions from Holt’s method versus the
> Create a double moving average model (with k 5 2) for the data set. a. Prepare a line graph comparing the double moving average predictions against the original data. b. What are the forecasts for the next 2 years using this technique?
> Prepare a line graph of these data. Do the data appear to be stationary or nonstationary?
> Use regression analysis to fit a linear trend model to the data set. a. What is the estimated regression function? b. Interpret the R2 value for your model. c. Prepare a line graph comparing the linear trend predictions against the original data. d. Wha
> What is the result of using regression analysis to estimate a linear trend model for a stationary time series?
> The manager of the commercial loan department for a bank wants to develop a rule to use in determining whether or not to approve various requests for loans. The manager believes that three key characteristics of a company’s performance
> The Royalty Gold Corporation prospects for undiscovered gold deposits around the world. The company is currently investigating a possible site on the island of Milos off the coast of Greece in the Mediterranean. When prospecting, the company drills to co
> The director of the MBA program at Salter dine University wants to develop a procedure to determine which applicants to admit to the MBA program. The director believes that an applicant’s undergraduate grade point average (GPA) and scor
> Refer to the Universal Bank example used to demonstrate the various classification techniques in this chapter. Suppose the Universal Bank data had included the home zip code for each customer. What issues might arise in using the customer’s zip code as a
