Question
Your company has the sales for year 1 below. You want to select from one of three models for forecasting: a three-month moving average, a
Your company has the sales for year 1 below. You want to select from one of three models for forecasting: a three-month moving average, a weighted moving average (you believe that the weights should be 0.2, 0.3, and 0.5), and an exponential smoothing average in which you use an alpha of 0.2 and an assumed forecast for January of year one of $35,000. Determine sales forecast for January year 2 and calculate MAD. Jan Yr 1 34284 Feb 34000 Mar 31017 Apr 33406 May 34518 Jun 35469 Jul 35360 Aug 34894 Sep 34547 Oct 31015 Nov 31167 Dec 32925 A) Three-month moving average: Sales forecast: $ MAD: B) Weighted moving average: Sales forecast: $ MAD: C) Exponential moving average: Sales forecast: $ MAD: Which forecasting method should you use for your company? (enter A, B, C):
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started