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    CH 4 P 5

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    Ghada k
    The document contains historical demand data over 11 years and uses two different moving average approaches to forecast future demand: 1) A 3-year simple moving average, which forecasts demand from years 4 through 12. The mean absolute deviation for this forecast is 2.63. 2) A 3-year weighted moving average that assigns weights of 0.15, 0.25, and 0.60 to the past 3 years of data. This approach forecasts demand from years 4 through 12 and has a mean absolute deviation of 2.54. The weighted moving average produces the better forecast based on its lower mean absolute deviation value.

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    CH 4 P 5

    Uploaded by

    Ghada k
    96 views2 pages
    The document contains historical demand data over 11 years and uses two different moving average approaches to forecast future demand: 1) A 3-year simple moving average, which forecasts demand from years 4 through 12. The mean absolute deviation for this forecast is 2.63. 2) A 3-year weighted moving average that assigns weights of 0.15, 0.25, and 0.60 to the past 3 years of data. This approach forecasts demand from years 4 through 12 and has a mean absolute deviation of 2.54. The weighted moving average produces the better forecast based on its lower mean absolute deviation value.

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    solution ch 4 IDS

    Original Title

    ch4p5

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    The document contains historical demand data over 11 years and uses two different moving average approaches to forecast future demand: 1) A 3-year simple moving average, which forecasts demand from years 4 through 12. The mean absolute deviation for this forecast is 2.63. 2) A 3-year weighted moving average that assigns weights of 0.15, 0.25, and 0.60 to the past 3 years of data. This approach forecasts demand from years 4 through 12 and has a mean absolute deviation of 2.54. The weighted moving average produces the better forecast based on its lower mean absolute deviation value.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    96 views2 pages

    CH 4 P 5

    Uploaded by

    Ghada k
    The document contains historical demand data over 11 years and uses two different moving average approaches to forecast future demand: 1) A 3-year simple moving average, which forecasts demand from years 4 through 12. The mean absolute deviation for this forecast is 2.63. 2) A 3-year weighted moving average that assigns weights of 0.15, 0.25, and 0.60 to the past 3 years of data. This approach forecasts demand from years 4 through 12 and has a mean absolute deviation of 2.54. The weighted moving average produces the better forecast based on its lower mean absolute deviation value.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    he following table shows the actual demand observed over the last 11 

    years:
                                                 
                                                 
                                                 
        
    Year 1 2 3 4 5 6 7 8 9 10 11
    Demand 6 8 4 7 13 9 13 13 9 9 8
    This exercise contains only parts b, c, and d.
    b) Using the 3-year moving average, provide the forecast from periods 4 through 12 (round your
    responses to one decimal  place).
    Year 4 5 6 7 8 9 10 11 12
    Forecast 6 6 6.3 6.3 8 8 9.6 9.6 11.6 11.6 11.6 11.6 11.6 11.6 10.3 10.3 8.6 8.6

    sum (Weight for period n*demandinperiod n)/sum(weights)

    c) Using the 3-year weighted moving average with weights


    0.15,
    0.25,
    and
    0.60,
    using
    0.60
    for the most recent period, provide the forecast from periods 4 through 12  (round your responses to
    two decimal  places).
    Year 4 5 6 7 8 9 10 11 12
    Forecast nothing nothing nothing nothing nothing nothing nothing nothing nothing

    wma 4 = (0.15*4)+(0.25*8)+(0.6*4)/1

    Deman
    year d wma
    1 6  
    2 8  
    3 4  
    4 7 5.3
    5 13 6.4
    6 9 10.15
    7 13 9.7
    8 13 12
    9 9 12.4
    10 9 10.6
    11 8 9.6
    8.4

    c) Using the 3-year weighted moving average with weights


    0.15,
    0.25,
    and
    0.60,
    using
    0.60
    for the most recent period, provide the forecast from periods 4 through 12  (round your responses to
    two decimal  places).
    Year 4 5 6 7 8 9 10 11 12
    Forecast 5.3 5.3 6.4 6.4 10.15 10.15 9.7 9.7 12 12 12.4 12.4 10.6 10.6 9.6 9.6 8.4 8.4
    d) Mean absolute deviation for the forecast developed using the 3-year moving average is
    2.63
    and for the 3-year weighted moving average is
    2.54.
    Based on this information, the better forecast is achieved using the
    weighted moving average

    approach.

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