ITIS361-ITS461 1st 2022-2023

Timeseries Forecasting Exercises

Exercise-1:
The manufacture wants to forecast how many units to produce to meet the future demand
of next month. The table below shows the demand of the last 19 months:
Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Demand 446 454 455 423 457 441 426 487 501 522 509 489
Month Jan Feb Mar Apr May Jun Jul
Demand 510 457 474 526 550 543 ?

Question 1:
1) Using Moving Average Forecasting method, what would be your forecast for the
demand in next month?
• Two periods moving average
• Four periods moving average
2) Which of the two forecasts for next month do you prefer and why?

Question 2:
1) Using Exponential Smoothing Forecasting method, what would be your forecast for
the demand in next month?
• Smoothing constant of 0.2
• Smoothing constant of 0.8
2) Which of the two forecasts for next month do you prefer and why?
3) Produce a “Data Table” for α values to see how MSE is sensitive for α changes.
4) Find the optimum value for α by using the Solver

Question 3: Which of the two forecasts methods (Moving Average and Exponential
Smoothing) for next month do you prefer and why?

Amna Khalifa
 ITIS361-ITS461 1st 2022-2023

Exercise-2:
The purchasing department is responsible for ensuring that the organization maintains
the correct level of inventory to produce and sell products. The purchasing department
wants to forecast how many computers should be purchased to meet the future demand
of computers of next month. The table below shows the demand for Computer Sales of
the last 2 years:
Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales 195000 213330 208005 249000 237040 270412 306200 264500 247800 260500 259000 290870
Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales 294453 271400 303050 310200 354210 389700 361400 388700 441050 346750 356200 386500
Month Jan
Sales ?

is there a trend? YES,

it's going up

we need alpha, beta, T1

(D2-D1), F1=D1

1) Use Trend-Adjusted Exponential Smoothing forecasting method to model monthly

computer sales. As you can see in the chart, the time series data have a trend. what
for year 3 would be your forecast for next January? Where the forecast of the first month is
389116 equal to 195000 and the trend of the first moth is equal to 18330 (D2-D1) and α=0.7
and β=0.1.
2) Calculate the Mean Square Error, produce a “Data Table” for α and β values to see
how MSE is sensitive for α and β changes. alpha=0.6, Beta=0.1
3) Find the optimum value for α and β by using the Solver
alpha=0.6 Beta=0.09

Amna Khalifa
 ITIS361-ITS461 1st 2022-2023

Exercise-3:
A museum is interested in forecasting the number of visitors for the upcoming year. The
following data are available, by quarter, since 2014.
YEAR Quarter Data YEAR Quarter Data
QR=4 Visitors Visitors
3 months 2014 Winter 86 2018 Winter 208
Spring 62 Spring 202
Summer 28 Summer 154
Fall 94 Fall 220
2015 Winter 106 2019 Winter 208
Spring 82 Spring 202
Summer 48 Summer 154
Fall 114 Fall 220
2016 Winter 140 2020 Winter 246
Spring 120 Spring 240
Summer 82 Summer 190
Fall 154 Fall 252
2017 Winter 188 2021 Winter ?
Spring 172 Spring ?
Summer 128 Summer ?
Fall 198 Fall ?

1) Forecast the number of visitors each quarter of 2021? Demand of Winter, Spring,
Summer and Fall 2021; Knowing that first year forecast is 250, first year Trend is 80,
α=0.8 and β=.2.
2) Find the optimized value of α and β using:
a. solver.
b. decision table.

Amna Khalifa
ITIS361-ITS461 1st 2022-2023

Exercise-4:
The airlines company wants to forecast the no. of passengers. The company provided
monthly demand “no. of passengers” from the previous 10 months.
Month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
Demand 200 215 210 220 230 220 235 215 220 210
Question 1:
1) Using Moving Average Forecasting method, what would be your forecast for the
demand in November?
• Three months moving average
• Four months moving average
• Five months moving average
2) Which of the three forecasts for November do you prefer and why?

Question 2:
1) Using Exponential Smoothing Forecasting method, what would be your forecast for
the demand in November?
• Smoothing constant of 0.1
• Smoothing constant of 0.2
• Smoothing constant of 0.3
2) Which of the three forecasts for November do you prefer and why?
3) Create a “Data Table” for α values to see how MSE is sensitive for α changes.
4) What other factors, not considered in the above calculations, might influence
demand in November?

Question 3:
1) Using Trend-Adjusted Exponential Smoothing forecasting method, what would be
your forecast for the demand in November? Where the forecast of the first month is
equal to 200 and the trend of the first moth is equal to 15 (D2-D1) and α=0.4 and
β=0.4.
2) Calculate the Mean Square Error, create a “Data Table” for α and β values to see how
MSE is sensitive for α and β changes.
3) Find the optimum value for α and β by using the Solver

Question 4: Which of the three forecasts methods (Moving Average, Exponential

Smoothing and Trend-Adjusted Exponential Smoothing) for November do you prefer
and why?

Amna Khalifa