Intek-Electronics is planning a strategic market launch for its new SPM cellular phones. The company's marketing manager would like to estimate the sales for the first month. However, neither the senior executives nor the sales team have sufficient knowledge of this product and so are unable to make any reasonable forecast.

You are required to name and explain one (1) method that could be used to establish a forecast for the first month.

(6 marks) Part (b)

The Demand for local Irish-potato has been steadily increasing since the government reduced the importation of Irish-potato. The CLB Company sells local Irish potato and wishes to forecast the weekly demand leading up to the Christmas holiday. The table below shows the demand (in thousands of pounds) for local Irish potato during weeks leading up to Christmas.

Table 2.

Weeks	Demand (000)
1	48
2	65
3	75
4	82
5	90
6	92
7

(i) It was predicted that the demand for local Irish potatoes during week 1 would be 50 thousand pounds. Using exponential smoothing with= 0.75, develop forecasts for weeks 2 through to week 7.

(ii) Use a two-period weighted moving average, with weightsw₁ 3,w₂5to forecast for years 3 through 7. Assign weightw₂ to the most recent period.

(iii) Using the Mean Absolute Deviation (MAD) or any other suitable forecast error method, determine which of the methods analyzed here is better to use? Explain your answer.

(4+4+3 marks)