You found part time employment at a local bicycle shop in your home town to help subsidising your studies. In the first week of employment, you noticed that the stock for bicycles fluctuated because the owner did not do appropriate forecasting for the shop. You studied the actual bicycle sales for the last six weeks which resulted in the information in the table below:

You decided to do a forecast for week 7 to convince the owner it is prudent to do forecasting. To do so you are required to: A. Identify the correct equation for a moving average and compute the forecast for week 7 utilising a three-period moving average. Use the table above to reflect the forecast. (9 Marks)

To convince the owner of the reliability of forecasting, you also decided to utilise a weighted moving average. The weights applied by you are 3 for last weeks sales, 2 for two weeks ago and 1 for three weeks ago. Identify the correct equation and compute the weighted three-week moving average. Use the table above to reflect the forecast. (9 Marks)

\begin{tabular}{|l|l|} \hline Week & Actual Bicycle Sales \\ \hline 1 & 8 \\ \hline 2 & 10 \\ \hline 3 & 9 \\ \hline 4 & 11 \\ \hline 5 & 10 \\ \hline 6 & 13 \\ \hline \end{tabular}