question archive TIPS and FAQs for Forecasting Excel assignment Following is a list of questions/ common mistakes from the TR class that has the same assignment that I hope are helpful
TIPS and FAQs for Forecasting Excel assignment Following is a list of questions/ common mistakes from the TR class that has the same assignment that I hope are helpful
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TIPS and FAQs for Forecasting Excel assignment
Following is a list of questions/ common mistakes from the TR class that has the same assignment that I hope are helpful.
1. To calculate a MAD for a specific month you must have an actual and a forecast or the MAD is not valid.
2. When calculating the MAD for one method you need to average all the individual month MAD calculations.
3. When calculating a forecast using a moving average you must have enough prior period actuals to be valid. Example: If you are calculating a 4 month moving forecast you must have four prior periods to forecast the 5th period.
4. Using exponential smoothing you must have a forecast and an actual from the prior month to calculate the current month. If you are calculating a forecast for February you must have actual and forecast for January.
5. MAD and actual error are not calculated the same way but in many cases may be equal.
6. When evaluating which forecasting method is the most accurate you must compare MADs only or MSEs only. You cannot compare a MAD from two methods and a MSE from 2 methods and draw an accurate conclusion.
7. Make sure you have the proper formula when using exponential smoothing. It is easy to use the wrong period or to switch actual and forecast. You will never have an actual and a forecast from different periods when calculating a forecast for a given period.
