Joe Kool has decided to use the 3-month weighted moving average method for one of his company’s products. Last year’s monthly sales data are given in Table 2.11.

Joe is trying to decide the appropriate weights to select for his forecasting method that will minimize the sum of the absolute errors between the forecasts and the actual values. Show that the determination of the optimal weights can be formulated as an LP problem. Solve the linear program using any optimization software and determine the forecast for month 13.

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TABLE 2.11 Sales Data for Exercise 2.8 Month 1 23456 Sales 5325 5405 5200 5510 5765 5210 Month 94 7 8 9 10 11 12 Sales 5375 5585 5460 4905 5755 6320