Documente Academic
Documente Profesional
Documente Cultură
Rahul Sharma
Class number:
TDM
Fund Name:
In the work sheet, each row represents individual month stock history. The columns contain the following
information:
A.
Time series forecasting is the use of a model to predict future values based on previously observed values. Thus it
is a sequence of discrete-time data. Time series analysis comprises methods for analyzing time series data in order
to extract meaningful statistics and other characteristics of the data. Time series forecasting is the use of a model to
predict future values based on previously observed values.
A trend analysis is an aspect of technical analysis that tries to predict the future movement of a stock based on
past data. Trend analysis is based on the idea that what has happened in the past gives traders an idea of what will
happen in the future. In Minitab, choose Stat > Time Series > Time Analysis. To fit trend lines using a linear,
quadratic, growth, or S curve trend model, we perform a trend analysis.
1.
Linear Model:
Minitab Data set: The data was imported from yahoo finance in an excel format and was arranged in ascending
order.
In the work sheet, each row represents individual month stock history. The columns contain the following
information:
Linear Trend Forecasting Definition. ... It is a simplistic forecasting technique that can be used to predict demand,
and is an example of a time series forecasting model. Linear Trend Forecasting Description.
Variable
Actual
Fits
Forecasts
90
80
Accuracy Measures
MAPE 21.257
MAD
10.615
MSD 184.510
Close
70
60
50
40
30
20
10
1
10
20
30
40
50
Index
Data
Close
Length 102
NMissing 0
Fitted Trend Equation
Yt = 44.37 + 0.3823t
60
70
80
90
100
Accuracy Measures
MAPE 21.257
MAD 10.615
MSD 184.510
Forecasts
Period
103
104
105
Forecast
83.7501
84.1324
84.5148
Histogram:
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram for close:
Histogram
(response is Close)
18
16
14
Frequency
12
10
8
6
4
2
0
-30
-20
-10
10
20
30
40
Residual
A histogram with a prominent mound in the center and similar tapering to the left and right. One indication of this
shape is that the data is unimodal meaning that the data has a single mode, identified by the peak of the
curve.Note that a normally distributed data set creates a symmetric histogram that looks like a bell, leading to the
common term for a normal distribution: a bell curve.
2.
Quadratic Model:
Minitab Data set: The data was imported from yahoo finance in an excel format and was arranged in ascending
order.
In the work sheet, each row represents individual month stock history. The columns contain the following
information:
Variable
Actual
Fits
Forecasts
90
80
Accuracy Measures
MAPE
21.156
MAD
10.373
MSD 171.987
Close
70
60
50
40
30
20
10
1
10
20
30
40
50
60
70
80
90
100
Index
Forecasts
Period
103
104
105
Forecast
91.8993
92.7564
93.6225
Histogram:
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
18
16
14
Frequency
12
10
8
6
4
2
0
-30
-20
-10
10
20
30
Residual
A histogram with a prominent mound in the center and similar tapering to the left and right. One indication of this
shape is that the data is unimodal meaning that the data has a single mode, identified by the peak of the
curve.Note that a normally distributed data set creates a symmetric histogram that looks like a bell, leading to the
common term for a normal distribution: a bell curve.
3.
Minitab Data set: The data was imported from yahoo finance in an excel format and was arranged in ascending
order.
In the work sheet, each row represents individual month stock history. The columns contain the following
information:
Variable
Actual
Fits
Forecasts
90
80
Accuracy Measures
MAPE
20.012
MAD
10.421
MSD
183.501
Close
70
60
50
40
30
20
10
1
10
20
30
40
50
Index
Forecasts
Period Forecast
103
87.0017
60
70
80
90
100
104
105
87.6029
88.2083
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram for Close:
Histogram
(response is Close)
20
Frequency
15
10
-30
-20
-10
10
20
30
40
Residual
A histogram with a prominent mound in the center and similar tapering to the left and right. One indication of this
shape is that the data is unimodal meaning that the data has a single mode, identified by the peak of the
curve.Note that a normally distributed data set creates a symmetric histogram that looks like a bell, leading to the
common term for a normal distribution: a bell curve.
4.
S-Curve Model:
Minitab Data set: The data was imported from yahoo finance in an excel format and was arranged in ascending
order.
In the work sheet, each row represents individual month stock history. The columns contain the following
information:
Variable
Actual
Fits
Forecasts
100
90
Curve Parameters
Intercept
38.4620
Asymptote -17.1410
Asym. Rate 0.9979
Close
80
70
Accuracy Measures
MAPE 20.532
MAD
11.543
MSD 225.503
60
50
40
30
20
1
10
20
30
40
50
60
70
80
90
100
Index
Forecast
103.292
104.829
106.408
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
20
Frequency
15
10
-30
-20
-10
10
20
30
40
Residual
A histogram with a prominent mound in the center and similar tapering to the left and right. One indication of this
shape is that the data is unimodal meaning that the data has a single mode, identified by the peak of the
curve.Note that a normally distributed data set creates a symmetric histogram that looks like a bell, leading to the
common term for a normal distribution: a bell curve.
Histogram:
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
Choose Graph > Histogram.
Choose Simple, then click OK.
Under Graph variables, enter a column of numeric or date/time data.
Click OK.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
Histogram for Close:
Histogram of Close
Normal
14
12
Frequency
10
8
6
4
2
0
15
30
45
60
75
90
105
Close
The above graph displays a normal distribution. This shape, also known as the Gaussian curve, has a fearsome
formula which crucially includes the mean and SD of the distribution on the right hand side. I.e. y is a function of
the mean and SD of the distribution, as well as x. I.e. you get different normal curves depending on what the mean
is, and the spread of scores. They are always symmetrical, but some can be quite flat, some very tall and thin.
Histogram for In. Close:
Histogram of In.Close
Normal
Mean 0.01755
StDev 0.008146
N
102
40
Frequency
30
20
10
0.00
0.01
0.02
0.03
In.Close
0.04
0.05
0.06
Histogram of Sq.Close
Normal
14
12
Frequency
10
8
6
4
2
0
1500
3000
4500
6000
7500
9000
Sq.Close
Variable
Actual
Fits
Forecasts
95.0% PI
90
80
Moving Average
Length 1
Close
70
Accuracy Measures
MAPE 9.6365
MAD
4.8625
MSD 48.1594
60
50
40
30
20
10
1
10
20
30
40
50
Index
60
70
80
90
100
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
Histogram
(response is Close)
35
30
Frequency
25
20
15
10
5
0
-40
-30
-20
-10
10
Residual
MAPE
MAD
MSD
LINEAR
21.257
10.615
184.510
QUADRATIC
21.156
10.373
171.987
EXPONENTIAL
20.012
10.421
183.501
S-CURVE
20.532
11.543
225.503
The above trend analysis plot table compares the different Accuracy- Mean Absolute Percentage Error(MAPE),
Mean Absolute Deviation(MAD) and the Mean Standard Deviation/Error(MSD/MSE) of the four different trend
models.
Forecasting: Forecasting is a method that is used extensively in time series analysis to predict a response
variable, such as monthly profits, stock performance, or unemployment figures, for a specified period of time.
Forecasts are based on patterns in existing data. For example, here we forecast or predict the closing prices of AFSI
stock for the 103rd, 104th and the 105th month based on the previous 102 months of data.
LINEAR
103rd
MONTH
83.7501
104th
MONTH
84.1324
105th
MONTH
84.5148
QUADRATIC
91.8993
92.7564
93.6225
EXPONENTIA
L
S-CURVE
87.0017
87.6029
88.2083
103.292
104.829
106.408
MODELS
Conclusion:
Quadratic model gives the best fit for trend analysis. Mean absolute deviation is 10.373 and mean square deviation
is 171.987. As model has the lowest MAPE and the Forecasted values are also closest to actual value this is the
best fit for trend analysis.
C.
Building a single exponential smoothing models fitted to the 102 months of stock price of AFSI
Get the 102 months AFSI monthly fund prices from 01-2008 to 06-2016
Select State > Time Series > Single Exponential Smoothing
Use Close Price as a Variable
Perform 5 model runs by Changing values of weight to use in Smoothing () from 0.2 to 0.5
For each model input 3 forecasts to generate 3 month future fund prices
For 5th model select Optimal Arima in Single Exponential Smoothing tab for iterating Optimized model
Compared forecasted results with Actual Results and with the Average of forecasted prices and Selected the
Best Match Result.
Variable
Actual
Fits
80
Smoothing Constant
1.09461
Accuracy Measures
MAPE 9.5025
MAD
4.8472
MSD 47.4117
Close
70
60
50
40
30
20
10
1
10
20
30
40
50
60
70
80
90
100
Index
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
35
30
Frequency
25
20
15
10
5
0
-40
-30
-20
-10
10
Residual
The above graph displays a moderately skewed distribution. A distribution heaped on the left with a longer tail on
the right is said to be positively skewed. One heaped on the right with a longer tail on the left is said to be
negatively skewed. Often the heap is on the side nearest a fixed end of the scale.
Single exponential smoothing model with = .2
Variable
Actual
Fits
Forecasts
95.0% PI
90
80
Smoothing Constant
0.2
Close
70
Accuracy Measures
MAPE 16.295
MAD
7.146
MSD 107.178
60
50
40
30
20
10
1
10
20
30
40
50
Index
60
70
80
90
100
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
40
Frequency
30
20
10
-40
-30
-20
-10
Residual
10
Variable
Actual
Fits
Forecasts
95.0% PI
90
80
Smoothing Constant
0.3
Close
70
Accuracy Measures
MAPE 13.9497
MAD
6.2822
MSD 82.3365
60
50
40
30
20
10
1
10
20
30
40
50
60
70
80
90
Index
Data
Length
Close
102
Smoothing Constant
0.3
Accuracy Measures
MAPE
MAD
MSD
13.9497
6.2822
82.3365
Forecasts
Period
103
104
105
Forecast
74.9184
74.9184
74.9184
What is a histogram?
Lower
59.5273
59.5273
59.5273
Upper
90.3096
90.3096
90.3096
100
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
35
30
Frequency
25
20
15
10
5
0
-40
-30
-20
-10
Residual
10
Variable
Actual
Fits
Forecasts
95.0% PI
90
80
Smoothing Constant
0.4
Close
70
Accuracy Measures
MAPE 12.3761
MAD
5.7078
MSD 68.9128
60
50
40
30
20
10
1
10
20
30
40
50
Index
60
70
80
90
100
Forecast Lower
74.4395 60.4557
74.4395 60.4557
74.4395 60.4557
Upper
88.4233
88.4233
88.4233
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
40
Frequency
30
20
10
-40
-30
-20
-10
Residual
10
Variable
Actual
Fits
Forecasts
95.0% PI
90
80
Smoothing Constant
0.5
Close
70
Accuracy Measures
MAPE 11.3040
MAD
5.3589
MSD 60.9259
60
50
40
30
20
10
1
10
20
30
40
50
60
70
80
Index
90
100
Forecasts
Period
103
104
105
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency. Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
35
30
Frequency
25
20
15
10
5
0
-40
-30
-20
-10
10
Residual
0.2
0.3
0.4
0.5
1.09461
MAPE
16.295
13.9497
12.3761
11.3040
9.5025
MAD
7.146
6.2822
5.7078
5.3589
4.8472
MSD
107.178
82.3345
68.9128
60.9259
47.4117
Forecasted values
103
104
76.0285 76.0285
74.9184 74.9184
74.4395 74.4395
74.1530 74.1530
70.5813 70.5813
105
76.0285
74.9184
74.4395
74.1530
70.5813
The above plot table compares the different Accuracy- Mean Absolute Percentage Error(MAPE), Mean Absolute
Deviation(MAD) and the Mean Standard Deviation/Error(MSD/MSE) of the five different smoothing models.
Optima 1.09461
Arima
MAPE
MAD
MSD
9.5025
4.8472
47.4117
Forecasted values
103
104
105
70.5813
70.5813 70.5813
Conclusion:
Optima Arima gives the best fit for single exponential smoothing model with weighted smoothing factor =
1.09461. The mean absolute percent error is least i.e. 9.5025, the Mean absolute deviation is 4.8472 and mean
square deviation is 47.4117. Comparing the values of actual and forecasted and the average of the forecasted values
of 102nd, 103rd, 104th model Optima Arima has nearest forecasted values to the actual values. As model has the
lowest MAPE and the Forecasted values are also closest to actual value this is the best fit for single exponential
smoothing model.
D.
Double exponential smoothing smoothes your data by Holt (and Brown as a special case) double exponential
smoothing and provides short-term forecasts. This procedure can work well when a trend is present but it can also
serve as a general smoothing method. Dynamic estimates are calculated for two components: level and trend.
100
90
80
Smoothing Constants
(level)
1.13197
(trend) 0.01969
Close
70
Accuracy Measures
MAPE 9.5629
MAD
4.9360
MSD 49.4117
60
50
40
30
20
10
1
10
20
30
40
50
60
70
80
Index
Forecasts
90
100
Period
103
104
105
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
30
Frequency
25
20
15
10
-40
-30
-20
-10
Residual
10
Variable
Actual
Fits
Forecasts
95.0% PI
90
80
Smoothing Constants
(level) 0.2
(trend) 0.2
Close
70
60
Accuracy Measures
MAPE 20.462
MAD
9.440
MSD 171.866
50
40
30
20
10
1
10
20
30
40
50
60
70
80
Index
90
100
Forecasts
Period
103
104
105
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
35
30
Frequency
25
20
15
10
5
0
-40
-20
20
Residual
40
90
80
Smoothing Constants
(level) 0.3
(trend) 0.3
70
Close
60
Accuracy Measures
MAPE
15.836
MAD
7.689
MSD 130.753
50
40
30
20
10
0
1
10
20
30
40
50
60
70
80
Index
90
100
Forecasts
Period
103
104
105
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
30
25
Frequency
20
15
10
-45
-30
-15
15
Residual
30
Variable
Actual
Fits
Forecasts
95.0% PI
80
Smoothing Constants
(level) 0.4
(trend) 0.4
60
Close
Accuracy Measures
MAPE 14.494
MAD
7.117
MSD 101.941
40
20
0
1
10
20
30
40
50
60
70
Index
80
90
100
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
30
25
Frequency
20
15
10
-30
-15
15
Residual
30
Variable
Actual
Fits
Forecasts
95.0% PI
80
Smoothing Constants
(level) 0.5
(trend) 0.5
60
Close
Accuracy Measures
MAPE 13.3944
MAD
6.7766
MSD 89.5642
40
20
0
1
10
20
30
40
50
60
70
80
90
100
Index
What is a histogram?
A histogram is a graph that you can use to assess the shape and spread of continuous sample data. You might create
a histogram before or during an analysis to help confirm assumptions and guide additional analyses.
To draw a histogram, Minitab divides sample values into intervals called bins. By default, each bar on the
histogram represents the number of observations falling within a bin (the frequency). Minitab automatically
determines an optimal number of bins, but you can edit the number of bins in addition to the intervals covered by
each.
The center is the median and/or mean of the data. The spread is the range of the data. And, the shape describes the
type of graph. The four ways to describe shape are whether it is symmetric, how many peaks it has, if it is skewed
to the left or right, and whether it is uniform.
Histogram
(response is Close)
25
Frequency
20
15
10
-30
-15
15
30
Residual
MAPE
MAD
0.2
0.2
20.462
9.440
0.3
0.3
18.836
7.689
0.4
0.4
14.994
7.117
0.5
0.5
13.394
MSD
171.86
6
130.75
3
101.94
1
89.504
2
49.4117
Forecasted values
103
104
71.5902 70.6729
105
69.7556
71.4934
70.7021
69.9109
72.8180
72.6888
72.5595
6.776
74.4958 75.2310 75.6661
6
5(Optim 1.1319 0.0196 9.5629 4.936
70.2484 70.2305 70.2285
a Arima) 7
9
0
The above analysis plot table compares the different Accuracy- Mean Absolute Percentage Error(MAPE), Mean
Absolute Deviation(MAD) and the Mean Standard Deviation/Error(MSD/MSE) of the five different double
smoothing models.
5(Optim 1.1319
a Arima) 7
MAPE MAD
MSD
0.0196
9
9.5629
49.411
7
4.9360
Forecasted values
103
104
105
70.2484 70.230 70.228
5
5
Conclusion:
Model 5 gives the best fit for double exponential smoothing model weighted smoothing factor = 1.13197 and
weighted smoothing Trend factor = 0.01969. The mean absolute percent error is least i.e. 9.5629, the Mean
absolute deviation is 4.9360 and mean square deviation is 49.4117. Comparing the values of actual and forecasted
and the average of the forecasted values of 103, 104, 105th model 5 has nearest forecasted values to the actual
values. As model has the lowest MAPE and the Forecasted values are also closest to actual value this is the best fit
for double exponential smoothing model.
Part II: Linear Programming Models
Problem:Roedel Electronics produces table computer accessories, including integrated keyboard tablet stands that
connect a keyboard to a tablet device and holds the device at a preferred angle for easy viewing and typing.
Roedel produces two sizes of integrated keyboard tablet stands, a small and a large size. Each size uses the
same keyboard attachment, but the stand consists of two different stock s, a top flap and a vertical stand that
differ by size. Thus, a completeintegrated keyboard tablet stand consists of three subassemblies that are
manufactured by Roedel: a keyboard, a top flap, and a vertical stand.
Roedels sales forecast indicates that 7000 small integrated keyboard tablet stands and 5000 large integrated
keyboard tablet stands will be needed to satisfy demand during the upcoming Christmas season. Because
only 500 hours of in-house manufacturing time are available, Roedel is considering purchasing some, or all, of
the subassemblies from outside suppliers. If Roedel manufacturers a subassembly in-house, it incurs a fixed
setup cost, as well a variable manufacturing cost. The following table shows the setup cost, the manufacturing
time per subassembly, the manufacturing cost per subassembly, and the cost of purchase each of the
subassemblies from an outside supplier:
Subassem Setup
bly
Cost ($)
Keyboard
Small top
flap
Large top
flap
Small
vertical
stand
Large
vertical
stand
Manufactu
ring Cost
per Unit
($)
0.40
2.90
Purchase
Cost per
Unit ($)
1000
1200
Manufactu
ring Time
per Unit
(min.)
0.9
2.2
1900
3.0
3.15
3.70
1500
0.8
0.30
0.50
1500
1.0
0.55
0.70
0.65
3.45
PART A: Determine how many units of each subassembly Roedel should manufacture and how many units of each
subassembly Roedel should purchase. What is the total manufacturing and purchase cost associated with your
recommendation?
Solution
1. Optimization model structure specified
!objective;
Min=
1300*y1+0.44*K+0.65*K1
+1560*y2+3.19*SF+3.45*SF1
+2470*y3+3.465*LF+3.70*LF1
+1950*y4+0.33*SV+0.50*SV1
+1950*y5+0.605*LV+0.70*LV1;
@BIN( y1);
Y1- is binary variable to set up cost for K(keyboard), Y1=0 means the cost is required, otherwise the cost is not
required
similarly ,
@BIN( y2);
Y2- is binary variable to set up cost for SF(small top flap), Y1=0 means the cost is required, otherwise the cost is
not required
@BIN( y3);
Y3:is binary variable to set up cost for LF(large top flap), Y1=0 means the cost is required, otherwise the cost is
not required, This is not considered because Large flap top is already purchased
@BIN( y4);
Y4:is binary variable to set up cost for SV(small vertical stand), Y1=0 means the cost is required, otherwise the
cost is not required
@BIN( y5);
Y5:is binary variable to set up cost for LV(large vertical stand), Y1=0 means the cost is required, otherwise the
cost is not required
K+K1=12000;
total keyboard units, 7000 small integrated keyboard tablet stands and 5000 large integrated keyboard
SF+SF1=7000;
55970.00
55970.00
0.000000
0
6
0.23
Model Class:
MILP
Total variables:
Nonlinear variables:
Integer variables:
15
0
5
Total constraints:
Nonlinear constraints:
22
0
Total nonzeros:
Nonlinear nonzeros:
50
0
Following table shows the optimal solution of the above lingo code. It shows the value of each variable.
Variable
Y1
K
K1
Y2
SF
SF1
Y3
LF
LF1
Y4
SV
SV1
Y5
LV
LV1
Row
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
Value
1.000000
12000.00
0.000000
1.000000
7000.000
0.000000
0.000000
0.000000
5000.000
0.000000
0.000000
7000.000
0.000000
0.000000
5000.000
Reduced Cost
-1220.000
0.000000
0.000000
-260.0000
0.000000
0.000000
1295.000
0.000000
0.000000
760.0000
0.000000
0.000000
1475.000
0.000000
0.000000
Slack or Surplus
55970.00
0.000000
0.000000
0.000000
0.000000
0.000000
61.00000
0.000000
0.000000
0.000000
0.000000
0.000000
12000.00
7000.000
0.000000
0.000000
0.000000
0.000000
0.000000
5000.000
7000.000
5000.000
Dual Price
-1.000000
-0.6500000
-3.450000
-3.700000
-0.5000000
-0.7000000
0.000000
0.2100000
0.2600000
0.2350000
0.1700000
0.9500000E-01
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
Above solution in column display the value only if it is existing, and is 0.00000 otherwise.
Results Interpretation:
Problem: Determine how many units of each subassembly Roedel should manufacture and how many units of
each subassembly Roedel should purchase. What is the total manufacturing and purchase cost associated with your
recommendation?
Solution:
Units of each subassembly to be manufactured:
K
SF
12000.00
7000.000
5000.0000
SV1
7000.000
LV1
5000.000
B. Suppose Roedel is considering purchasing new machinery to produce large top flaps. For the new
machinery, the setup cost is $3,000; the manufacturing time is 2.5 minutes per unit; and the manufacturing
cost is $2.60 per unit. Assuming that the new machinery is purchased, determine how many units of each
subassembly Roedel should manufacture and how many units of each subassembly Roedel should purchase.
What is the total manufacturing and purchase cost associated with your recommendation? Do you think the
new machinery should be purchased? Explain.
Solution
1.Optimizationmodelstructurespecified
!objective;
1300*y1+0.44*K+0.65*K1
+1560*y2+3.19*SF+3.45*SF1
+2470+2.60*LF+3.70*LF1
+1950*y4+0.33*SV+0.50*SV1
+1950*y5+0.605*LV+0.70*LV1;
Y1- is binary variable to set up cost for K(keyboard), Y1=0 means the cost is required, otherwise the cost is not
required
similarly ,
@BIN( y2);
Y2- is binary variable to set up cost for SF(small top flap), Y1=0 means the cost is required, otherwise the cost is
not required
!@BIN( y3);
Y3:is binary variable to set up cost for LF(large top flap), Y1=0 means the cost is required, otherwise the cost is
not required. This is not considered because Large flap top is already purchased
@BIN( y4);
Y4:is binary variable to set up cost for SV(small vertical stand), Y1=0 means the cost is required, otherwise the
cost is not required
@BIN( y5);
Y5:is binary variable to set up cost for LV(large vertical stand), Y1=0 means the cost is required, otherwise the
cost is not required
K+K1=12000;
total keyboard units, 7000 small integrated keyboard tablet stands and 5000 large integrated keyboard
SF+SF1=7000;
SV<=7000*y4;
LV<=5000*y5;
54500.00
54500.00
0.000000
3
8
0.05
Model Class:
MILP
Total variables:
Nonlinear variables:
Integer variables:
14
0
4
Total constraints:
Nonlinear constraints:
21
0
Total nonzeros:
Nonlinear nonzeros:
47
0
Following table shows the optimal solution of the above lingo code. It shows the value of each variable.
Variable
Value
Reduced Cost
Y1
1.000000
K
12000.00
K1
0.000000
Y2
0.000000
SF
0.000000
SF1
7000.000
LF
5000.000
LF1
0.000000
Y4
0.000000
SV
0.000000
SV1
7000.000
Y5
0.000000
LV
0.000000
LV1
5000.000
Row
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Slack or Surplus
54500.00
0.000000
0.000000
0.000000
0.000000
0.000000
111.5000
0.000000
0.000000
0.000000
0.000000
12000.00
0.000000
5000.000
0.000000
0.000000
0.000000
7000.000
0.000000
7000.000
5000.000
-1220.000
0.000000
0.000000
-260.0000
0.000000
0.000000
0.000000
0.8400000
760.0000
0.000000
0.000000
1475.000
0.000000
0.000000
Dual Price
-1.000000
-0.6500000
-3.450000
-2.860000
-0.5000000
-0.7000000
0.000000
0.2100000
0.2600000
0.1700000
0.9500000E-01
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
0.000000
Above solution in column display the value only if it is existing, and is 0.00000 otherwise
PART B. Suppose Roedel is considering purchasing new machinery to produce large top flaps. For the new machinery, the setup
cost is $3,000; the manufacturing time is 2.5 minutes per unit; and the manufacturing cost is $2.60 per unit. Assuming that the new
machinery is purchased, determine how many units of each subassembly Roedel should manufacture and how many units of each
subassembly Roedel should purchase. What is the total manufacturing and purchase cost associated with your recommendation? Do
you think the new machinery should be purchased? Explain.
Solution:
12000.00
LF
5000.000
7000.000
SV1
7000.000
LV1
5000.000
54500.00
Yes, I think the new machinery should be purchased because the new machinery manufacturing and purchase cost is
lesser than the previous machinery cost
Problem 1 Screenshots:
Problem 2 Screenshots:
Step 1: Open Lingo and write the constraints.