Sam has a cleaning service. To better allocate his resources, he would like to f

Question

Sam has a cleaning service. To better allocate his resources, he would like to forecast his weekly orders based on the order number he received in the past 13 weeks as shown in the following table.

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Part 1)  Using a three week moving average, Sam's forecast for his Week 14 order number is _______________ . (Please round to two decimal points and include no units.)

Part 2) Using a three week weighted moving average with weights 3, 2, and 1 given to the most recent, second most recent, and third most recent week, respectively, Sam's forecast for his Week 14 order number is ___________ . (Please round to two decimal points and include no units.)

Part 3) If the MAD for moving average is 4.17 and the MAD for weighted moving average is 2.38, then which forecast is more accurate?

A. Moving average

B. Weighted moving average

C. The same

D. Not enough information to evaluate.

Week Demand Week 1 11 Week 2 14 Week 3 16 Week 4 10 Week 5 15 Week 6 17 Week 7 11 Week 8 14 Week 9 17 Week 10 12 Week 11 14 Week 12 16 Week 13

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Explanation / Answer

Answer: B

Explanation : MAD means Mean absolute Deviaiton - When we calculate the MAD for moving average,it is 4.17 and if we calculate the MAD for weighted moving average, it is 2.38, Lower MAD is more better or accurate than that of higher MAD. In case of weighted moving average, we give more weight to the latest week and next highest is to preceeding to the lastest week and so on.

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