Pumpkin Pies Galore is trying to forecast sales of pies forthe month of December. Demand for pies in September, October,and November has been 230, 304, and 415, respectively. Edith, thecompany’s owner, uses a three-period weighted moving averageto forecast sales. Based on her experience, she chooses to weightSeptember as 0.1, October as 0.3, and November as 0.6.(a) What would Edith’s forecast for December be?(b) What would her forecast be using the naïve method?(c) If actual sales for December turned out to be 420 pies,which method was better (use MAD)?
Pumpkin Pies Galore is trying to forecast sales of pies forthe month of December. Demand for pies in September, October,and November has been 230, 304, and 415, respectively. Edith, thecompany’s owner, uses a three-period weighted moving averageto forecast sales. Based on her experience, she chooses to weightSeptember as 0.1, October as 0.3, and November as 0.6.(a) What would Edith’s forecast for December be?(b) What would her forecast be using the naïve method?(c) If actual sales for December turned out to be 420 pies,which method was better (use MAD)?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter13: Regression And Forecasting Models
Section13.6: Moving Averages Models
Problem 22P: The file P13_22.xlsx contains total monthly U.S. retail sales data. While holding out the final six...
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Pumpkin Pies Galore is trying to
the month of December. Demand for pies in September, October,
and November has been 230, 304, and 415, respectively. Edith, the
company’s owner, uses a three-period weighted moving average
to forecast sales. Based on her experience, she chooses to weight
September as 0.1, October as 0.3, and November as 0.6.
(a) What would Edith’s forecast for December be?
(b) What would her forecast be using the naïve method?
(c) If actual sales for December turned out to be 420 pies,
which method was better (use MAD)?
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