Your company has the sales for year 1 below. You want to selectfrom one of three models for forecasting: a three-month movingaverage, a weighted moving average (you believe that the weightsshould be 0.2, 0.3, and 0.5), and an exponential smoothing averagein which you use an alpha of 0.2 and an assumed forecast forJanuary of year one of $35,000. Determine sales forecast forJanuary year 2 and calculate MAD.
Jan Yr 1 34284
Feb 34000
Mar 31017
Apr 33406
May 34518
Jun 35469
Jul 35360
Aug 34894
Sep 34547
Oct 31015
Nov 31167
Dec 32925
A) Three-month moving average:
Sales forecast: $
MAD:
B) Weighted moving average:
Sales forecast: $
MAD:
C) Exponential moving average:
Sales forecast: $
MAD:
Which forecasting method should you use for your company? (enter A,B, C):
