Affiliations: Department of Industrial Management and Enterprise Information, Aletheia University, Tamsui, New Taipei, Taiwan
Correspondence:
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Corresponding author: Shin-Li Lu, Department of Industrial Management and Enterprise Information, Aletheia University, 32 Chen-Li Street, Tamsui, New Taipei, Taiwan. E-mail:shinlilu@mail.au.edu.tw
Abstract: This paper presents a mechanism that integrates a grey model (GM) with an
exponentially weighted moving average adjustor, known as the EGM. This novel
EGM(1,1) model is combined with Markov processes to give the MEGM(1,1)
model, which is compared with the original GM(1,1) by exploring the
precision of their forecasts. The experimental results show that the average
precision of MEGM(1,1) using theoretical models improves from 21.00% to
64.72%, whereas for the empirical models it improves from 40.65% to
96.93%, effectively reducing the error level of the GM(1,1) model.
