6. The demand manager of Maverick Jeans is responsible for ensuring sufficient warehouse space for the finished jeans that come from the production plants. It has occasionally been necessary to rent public warehouse space, something that Maverick would like to avoid. In order to estimate the space requirements, the demand manager is evaluating moving-average forecasts. The demand (in 1,000 case units) for the last fiscal year is shown below.

a. Use a 3-month moving average to estimate the month-in-advance forecast of demand for months 4–12 and generate a forecast for the first month of next year. Calculate the average forecast error and mean absolute error.

b. Use a 3-month weighted moving average with weights of 0.6, 0.3, and 0.1 (most recent to least recent, respectively) to calculate month-inadvance forecasts for months 4–12 and forecast for the first month of next year. Calculate the average forecast error and mean absolute error.

c. Compare the average forecast error and MAD for the forecasting methods in parts a and

b. Based on these error calculations, which of the two forecast methods would you recommend? Why?

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Month 1 2 3 4 5 6 7 8 9 10 11 12 Demand 20 18 21 25 24 27 22 30 23 20 29 22 22