The manager of a pizza shop must forecast weekly demand for special pizzas so th
ID: 327691 • Letter: T
Question
The manager of a pizza shop must forecast weekly demand for special pizzas so that he can order pizza shells weekly. Recent demand has been: No. of Week Special Pizzas 61 58 52 65 68 57 2 Using a four-week moving average, what is the forecast for week 7? (Provide your answer with two decimal points.) If a four-week weighted moving average were used, what would be the forecast for week 7? (The weights are 0.77, 0.11, 0.11, and 0.01, in the order of most recent week first) (Provide your answer with two decimal points.)Explanation / Answer
Forecast for week 7 using 4 week moving average
= ( Demand week 3 + demand week 4 + Demand week 5 + demand week 6 ) / 4
= ( 52 + 65 + 68 + 57 ) / 4
= 242/4
= 60.5
Forecast for week 7 using weighted moving average
= 0.77 x Demand week 6 + 0.11 x Demand for week 5 + 0.11 x demand for week 4 + 0.01 x demand for 3
= 0.77 x 57 + 0.11 x 68 + 0.11 x 65 + 0.01 x 52
= 43.89 + 7.48 +7.15 + 0.52
= 59.04
FORECAST FOR WEEK 7 USING 4 WEEK MOVING AVERAGE = 60.5
FORECAST FOR WEEK 7 USING WEIGHTED MOVING AVERAGE = 59.04
FORECAST FOR WEEK 7 USING 4 WEEK MOVING AVERAGE = 60.5
FORECAST FOR WEEK 7 USING WEIGHTED MOVING AVERAGE = 59.04
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