# p301 chapter 3 forecasting

Home > Preview

The flashcards below were created by user Anonymous on FreezingBlue Flashcards.

1. components of a time series
• trends- when data is going up or down
• Cyclical- the effect on a time series cause by economic cycles
• Seasonality- short-term regular variations in data caused by calendar related events
• Random or Irregular variations- unpredictable and unexplainable functions in a time series caused by unusual circumstance
2. Naive Forecast
• Uses a single previous value of a time series as the basis for a forecast
• EX. the weather yesterday is going to be the same as tomorrow
• this is the number 1 method that business use
3. Averaging
• these techniques work best when a series tends to vary an average
•   - Averaging techniques smoothing variations in the data
•
•     -
4. Moving Average
• (only looks at randomness)
• (the more periods we use the less randomness)
• techniques that averages a number of recent actual values, updates as new values become available
5. Features of Forecasting
• - the past is a prediction of the future
• -they are not perfect
• -Forecasting for a group is better the a item
• -we can predict to days that are closer then ones that are farther away
6. forecast responsiveness
• is how quickly the forecast changes in actual demand
• responsiveness and stability are different when it comes to forecasting
• when you use fewer moving averages its makes it more responsive
• when you use more moving averages it makes it more stable
7. weighted moving average
• the most recent values in a time series are given more weight in computing a forecast
•   - the choice of weights ,w, is somewhat arbitrary and involves trail and error
8. simple Exponential Smoothing
• (its a form of weighting moving average moving them exponentially )
• Premise- the most recent observations might have the highest predictive value
• There for we should give more weight to the more recent time periods when forecasting

### Card Set Information

 Author: Anonymous ID: 295583 Filename: p301 chapter 3 forecasting Updated: 2015-02-11 17:15:49 Tags: p301 Folders: p301 Description: p301 Show Answers:

What would you like to do?

Home > Flashcards > Print Preview