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Titlecha 5.xls
TagsMoving Average Forecasting Seasonality Statistical Inference
File Size95.0 KB
Total Pages9
Document Text Contents
Page 3

Year Demand Forecast Error

Absolute

error

1 4

2 6

3 4

4 5 4.67 0.33 0.33

5 10 5.00 5.00 5.00

6 8 6.33 1.67 1.67

7 7 7.67 -0.67 0.67

8 9 8.33 0.67 0.67

9 12 8.00 4.00 4.00

10 14 9.33 4.67 4.67

11 15 11.67 3.33 3.33

Next period 13.67

MAD 2.54

Year

Actual

value Weights Forecast Error

Absolute

error

1 4 1

2 6 1

3 4 2

4 5 4.50 0.50 0.50

5 10 5.00 5.00 5.00

6 8 7.25 0.75 0.75

7 7 7.75 -0.75 0.75

8 9 8.00 1.00 1.00

9 12 8.25 3.75 3.75

10 14 10.00 4.00 4.00

11 15 12.25 2.75 2.75

Next period 14.00

MAD 2.313

3 period moving averages

Weighted moving averages

Data collected on the yearly demand for 50-pound bags of fertilizer at Wallace Garden Supply are shown in the

following table. Develop a three-year moving average to forecast sales. Then estimate demand again with a

weighted moving average in which sales in the most recent year are given a weight of 2 and sales in the other

two years are each given the weight of 1. Which method do you think is best?

Weighted moving average is slightly more accurate than 3-period moving average as MAD for Weighted

moving average is less among the two.

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