Two independent methods of forecasting based on judgment and experience have been prepared each month for the past 10 months. The forecasts and actual sales are as follows:
Month | Sales | Forecast 1 | Forecast 2 |
1 | 770 | 771 | 769 |
2 | 789 | 785 | 787 |
3 | 794 | 790 | 792 |
4 | 780 | 784 | 798 |
5 | 768 | 770 | 774 |
6 | 772 | 768 | 770 |
7 | 760 | 761 | 759 |
8 | 775 | 771 | 775 |
9 | 786 | 784 | 788 |
10 | 790 | 788 | 788 |
a. Compute a tracking signal for the 10th month for each forecast using the cumulative error for months 1 to 10. Use action limits of ± 4. Is there bias present? (Do not round your intermediate calculations. Round your answers to 2 decimal places. Negative amounts should be indicated by a minus sign.)
Forecast | Tracking Signal | Bias |
Method 1 | Present | |
Method 2 | Present | |
b. Compute 2s control limits for each forecast. (Do not round your intermediate calculations. Round your answers to 2 decimal places.)
Forecast | Control Limits |
Method 1 | |
Method 2 | |