Sales of vacuum cleaners over the past 6 months are as follows: a) Develop a 2-m

Question

Sales of vacuum cleaners over the past 6 months are as follows: a) Develop a 2-month moving average to forecast month February. b) Develop a 3-month moving average to forecast month February. c) Use 3-month weighted moving average to forecast month February, with 3 as the weight for the most recent past period. 2 for second most recent, and 1 for third most recent. d) Using exponential smoothing with alpha = 0.4, develop forecast for February. e) Which method from part c) and d) is best? Explain.

Explanation / Answer

2 a) as two month moving average foreacst =average of last 2 months actual

forecast for february =13.5

b)

c)

as weighted average =(3*last month actual+2*one month prior actual+1*two month prior actual)/(3+2+1)

hence

forecast for february =13.17

d)exponential forecast =alpha*last month actual+(1-alpha)*last month forecast

from above forecast for february =13.26

method in part c is better cause it gives less mean square error

please revert

two month moving average month sales Forecast August 14 September 17 October 12 15.5 November 14 14.5 December 16 13 January 11 15 February 13.5

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.