ASSIGNMENT-1

NAME- ARNAB KUMAR MANDAL

SAP ID-500108328

SEMESTAR-1ST

MAIL ID- [email protected]

QUANTITATIVE TECHNIQUES AND MANAGEMENT

APPLICATIONS
MBA IN POWER MANAGEMENT 2022-2024
 Assignment-1
Solution-
Part-1
For the appropriate forecasting technique, first we need to find out the tracking signal from different
forecasting methods and then the results will be compared. We will use different forecasting
techniques to arrive the tracking signal values by the following three methods: -

1.Moving Average method

2.Weighted Moving Average method

3.Simple Linear Regression Analysis

Method-1

Moving Average method (Taking 3 years average). Upon calculations on MS Excel and
tabulation, we get the below table in excel which I have attached below.
Moving average (three-year average values)
Running Running
sum of sum of
forecast Absolute absolute TS =
Forecast Forecast error error value value MAD RSFE/MAD
A F A-F ∑(A-F) |A-F| ∑|A-F| ∑|A-F|/n TS
Year Attendance
1989 53,353
1990 61,417
1991 63,853
1992 63,034 59,541 3,493 3,493 3493 3493 3493 1
1993 95,504 62,768 32,736 36,229 32736 36229 18114.5 2
1994 1,33,762 74,130 59632 95860.7 59631.67 95860.67 31953.56 3
1995 1,08,363 97,433 10,930 1,06,790 10929.67 106790.3 26697.58 4
1996 1,26,853 1,12,543 14,310 1,21,100 14310 121100.3 24220.07 5
1997 1,25,363 1,22,993 2,370 1,23,471 2370.333 123470.7 20578.44 6
1998 1,17,874 1,20,193 -2,319 1,21,152 2319 125789.7 17969.95 6.74
1999 1,23,363.33 1,23,363.33 0 1,21,151 0 125790 15723.7 7.71
2000 1,22,200

Note- RSFE - Running sum of forecasting errors, MAD - Mean absolute deviation, TS - Tracking signal

Notes and observations from the above table

By moving average method, the attendance forecasts for the year 1999 is 123,363 and for the year
2000 is 122,200. But the tracking signal is beyond (plus minus 4) for the years 1996, 1997, 1998 &
1999 respectively.

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Method-2

Weighted moving average (3-year average values)

In this method, we have to apply weightage for the 3 years which is as follows:-

Weightage
Applied Time period
3 Previous year
2 2 years ago
1 3 years ago
For this method after calculations on MS Excel and tabulation, we get the below table in
excel which I have attached below.
Weighted Moving average (three-year average)
Absolute TS =
Forecast Forecast error RSFE value MAD RSFE/MAD
Year
A F A-F ∑(A-F) |A-F| ∑|A-F| ∑|A-F|/n TS
Attendance
1989 53,353
1990 61,417
1991 63,853
1992 63,034 61,291 1,743 1,743 1743 1743 1743 1
1993 95,504 63,038 32,467 34,210 32466.5 34209.5 17104.75 2
1994 1,33,762 79,406 54357 88,566 54356.5 88566 29522 3
1995 1,08,363 1,09,221 -858 87,708 858.3333 89424.33 22356.08 3.92
1996 1,26,853 1,14,686 12,167 99,875 12166.83 101591.2 20318.23 4.92
1997 1,25,363 1,21,841 3,522 1,03,396 3521.833 105113 17518.83 5.90
1998 1,17,874 1,23,026 -5,152 98,244 5152.333 110265.3 15752.19 6.24
1999 1,21,867 1,21,867 0 98,244 0 110265.3 13783.17 7.13
2000 1,21,119

Notes and observations from the above table

By weighted moving average method we can clearly observe that the tracking signal is beyond
(plus minus 4) for the years 1996, 1997, 1998 & 1999 respectively. The attendance forecast for the
year 1999 was computed to be 121867 and for the year 2000 it was forecasted to be 121119.

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Method-3

Simple Regression Method

For this method after calculations on MS Excel and tabulation, we get the below table in
excel which I have attached below.
Simple Regression table

Year Attendance x x2 xy
1989 53,353 1 1 53353
1990 61,417 2 4 122834
1991 63,853 3 9 191559
1992 63,034 4 16 252136
1993 95,504 5 25 477520
1994 1,33,762 6 36 802572
1995 1,08,363 7 49 758541
1996 1,26,853 8 64 1014824
1997 1,25,363 9 81 1128267
1998 1,17,874 10 100 1178740
9,49,376 55 385 5980346
∑y ∑x ∑x2 ∑xy

Now, we know that Linear Regression equation Y= a+(b*x)

Where b= (n∑xy- ∑x ∑y)/ ((n∑x2- ∑ (x2)), Here n=10 for 10 no. of years
Or, b= ((10*5980346) -(55*949376))/ (10*385) -(55*55)

Or, b= 9197.31

and a= (∑y-b∑x)/n
Or, a=949376-(9197.309*55)

Or, a=44352.41

So, substituting the values of a and b on the linear regression equation, we have

Y= 44352.41+9197.31*x

So, forecasted attendance for the year 1999, taking x=11 in this case, we have

Y (1999) = 44352.41+9197.31*11 =145523(rounded off)

and

Y (2000) = 44352.41+9197.31*12 (Here we take x=12 for the year 2000)

=154720(rounded off).

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 SIMPLE LINEAR REGRESSION GRAPH

1,60,000

1,40,000 1,33,762
1,26,8531,25,363
1,17,874
1,20,000 1,08,363
95,504
1,00,000
ATTENDANCE

80,000
61,417 63,853 63,034
60,000 53,353

40,000

20,000

0
1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
YEARS

Linear Regression Table

Linear Regression method

Absolute
Demand Forecast Forecast error RSFE value MAD TS = RSFE/MAD
Year ∑|F-
D F F-D ∑(F-D) |F-D| ∑|F-D| D|/n TS
Attendance
1989 53,353 53549.7091 197 197 196.7091 196.7091 196.7091 1
1990 61,417 62747.0182 1,330 1,527 1330.018 1526.727 763.3636 2
1991 63,853 71944.3273 8,091 9,618 8091.327 9618.055 3206.018 3
1992 63,034 81141.6364 18,108 27,726 18107.64 27725.69 6931.423 4
1993 95,504 90338.9455 -5,165 22,561 5165.055 32890.75 6578.149 3.43
1994 1,33,762 99536.2545 -34,226 11,665 34225.75 67116.49 11186.08 -1.04
-
1995 1,08,363 108733.564 371 11,295 370.5636 67487.05 9641.008 -1.17
-
1996 1,26,853 117930.873 -8,922 20,217 8922.127 76409.18 9551.148 -2.12
-
1997 1,25,363 127128.182 1,765 18,451 1765.182 78174.36 8686.04 -2.12
1998 1,17,874 136325.491 18,451 0 18451.49 96625.85 9662.585 0.00
1999 1,45,523
2000 1,54,720

Notes and observations from the above table

From the above table we can observe that the tracking signal is within the limit of (plus minus 4)

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CONCLUSION

We have observed and calculated the data by all the three methods. Some of the tracking signal
values (for the years 1998-2000) obtained by moving average and weighted moving average are
beyond the limit of (+/- 4). But the forecasted data obtained by Linear Regression Method provides
us with a tracking signal values within the limits of (+/-4). Therefore, it is recommended for Akron to
use Linear Regression analysis for forecasting tourist gate admittance for the years of 1999 and
2000.

Solution Part-2

The factors that influence annual attendance which should be considered in the forecast are as
follows: -

 Location of the Zoo.

 Connectivity and transportation from nearby areas.
 New attractions list of the Zoo.
 The development of the area surrounding the zoo.
 Number of active animal shows.
 The seasonal weather.
 Campaign and marketing.
 Promotional events.
 Hassle free ticket booking through online and offline platforms.
 Proper fencing and security measures for the zoo.
 Parking facilities for cars and vehicles near zoo.
 Unique and exotic animals and creatures
 Other attractions beside the zoo.
 Overall economic condition of the surrounding areas.
 Population of the surrounding areas.
 Service quality and proper trained staff.
 Opening and closing time of zoo.
 Parks and food facilities especially for children.
 Proper emergency services and disaster management services in the area.
 Employment trends.
 Petrol and diesel prices.
 Pollution levels around the zoo such as air quality index.
 Tourism trends in the area.
 Cleanliness.
 Offers and discounts on groups.
 Special offers on festivals.
 Special animal shows.
 Newspaper and local news coverage and poster.
 Well trained staffs and proper tour guides.
 Proper maintenance and renovations on older exhibits.

Thank You………

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