The following data show the average prices for flat-panel televisions in the United States over a six-quarter period.

Month Q1 ’11 Q2 ’11 Q3 ’11 Q4 ’11 Q1 ’12 Q2 ’12 Price ($) 1,108 1,124 1,142 1,130 1,190 1,224 Based on: DisplaySearch data.

a. Forecast the average price of a flat-panel TV in the third quarter of 2012 using a two-period simple moving average.

b. Calculate the MAD for the forecast in part a.

c. Forecast the average price of a flat-panel TV in the third quarter of 2012 using a three-period simple moving average.

d. Calculate the MAD for the forecast in part b.

e. Which forecast would you choose?

AppendixLO1