The number of plumbing repair jobs performed by Augur\'s Plumbing Service in eac

Question

The number of plumbing repair jobs performed by Augur's Plumbing Service in each of the last three months is listed below. Show all calculations in answering the following questions. Use a three-month moving average method to forecast jobs in August. Use a weighted three-month moving average, with weights of 5, .33 and .17, to forecast August jobs. Now use the linear trend method to construct your forecast for August. Which of the methods above is likely to produce the most accurate forecast for August? Explain why.

Explanation / Answer

a. demand based on 3 month moving average;

August demand= (94+92+91)/3= 277/3= 92.33 units

b. based on weights, from latest to past= 91*0.5+92*0.33+94*0.17= 45.5+30.36+15.98= 91.84 units

c. based on linear trend- the demand estimation is = 91 units

d. among the 3 methods, weighted method is most relaible. because in this we consider the past sales with specified weightage to each month.

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