This study examines the precision of the Grey forecasting model applied to samples based on
demand and sales in the global integrated circuit (IC) industry. In doing so, the main objective is to
explore which forecast model is most appropriate for the IC industry by comparing the empirical
results from the Grey model (GM), time series and exponential smoothing. Furthermore, three residual
modification models are applied to enhance the forecasting results. Empirical results indicate that the
GM is better suited to short-term predictions than to mid- and long-term predictions. Meanwhile, the
Markov-chain residual modification model achieves reliable and precise results.D 2002 Elsevier Science Inc. All rights reserved.
Proceedings of the International Aviation Simulation and Modeling Conference, pp. 87-107