National Scan, Inc., sells radio frequency inventory tags. Monthly sales for a s
ID: 3203889 • Letter: N
Question
National Scan, Inc., sells radio frequency inventory tags. Monthly sales for a seven-month period were as follows: Month Sales (000)Units Feb. 16 Mar. 20 Apr. 12 May. 22 Jun. 17 Jul. 23 Aug. 30 Forecast September sales volume using each of the following: (1) A linear trend equation.(Round your intermediate calculations and final answer to 2 decimal places.) (2) A five-month moving average. (Round your answer to 2 decimal places.) (3) Exponential smoothing with a smoothing constant equal to .20, assuming a March forecast of 19(000). (Round your intermediate calculations and final answer to 2 decimal places.) (4) The naive approach. (5) A weighted average using .60 for August, .20 for July, and .20 for June. (Round your answer to 2 decimal places.)
Explanation / Answer
1)
Month
X
Sales Y
XY
X^2
Feb
1
19
19
1
Mar
2
20
40
4
Apr
3
15
45
9
May
4
21
84
16
Jun
5
17
85
25
Jul
6
23
138
36
Aug
7
26
182
49
Total:
28
141
593
140
Least square equation Y = a + b x = 15.98 + 1.04X
Given Sep X = 8, Y = 15.98 + 1.04(8) = 24.3
2)
Month
Sales
5 yeas Moving Average
Feb
19
-
Mar
20
-
Apr
15
-
May
21
-
Jun
17
-
Jul
23
18.4
Aug
26
19.2
Sep
20.4
Moving average : Setp forecasting is Yt = 20.4
(3)
Exonential Smoothing =0.30
Month
Sales
F(t+1) =*A(t-1)+(1-)F(t)
Feb
19
--
Mar
20
19
Apr
15
19.3
May
21
18.01
Jun
17
18.907
Jul
23
18.3349
Aug
26
19.73443
Sep
21.614101
Exponential Smoothing: Yt = 21.61
(4) Naive Approach: Yt = 26
Month
Sales
Naïve approach
Feb
19
-
Mar
20
19
Apr
15
20
May
21
15
Jun
17
21
Jul
23
17
Aug
26
23
Sep
26
Naive Approach: Yt = 26
(5)
Month
Sales
Weights
Weighted Moving Average
Feb
19
Mar
20
Apr
15
May
21
Jun
17
0.1
Jul
23
0.2
Aug
26
0.7
Sep
24.5
Weighted moving average = 17*0.1 + 23*0.2 + 26*0.7 = 24.5
Month
X
Sales Y
XY
X^2
Feb
1
19
19
1
Mar
2
20
40
4
Apr
3
15
45
9
May
4
21
84
16
Jun
5
17
85
25
Jul
6
23
138
36
Aug
7
26
182
49
Total:
28
141
593
140
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