I.

LEARNING ACTIVITIES

1. Complete the tables above.( 4-month moving average, 3-month weighted moving
average, 4 period weighted moving average)

Four-month moving average

Period Actual Demand Forecast
January 21
February 25
March 29
April 21
May 25 (21+25+29+21) = 24
4
June 20 (25+29+21+ 25) = 25
4
July 18 (20+25+21+29)/4=23.75
August 21 (18+20+25+21)/4= 21
Septembe 20 (22+18+20+25)/4= 21.25
r
October 19 (20+21+18+20)/4= 19.75
November 18 (19+20+21+18)/4=19.5
December 15 (18+19+30+21)/4=22

Three-month period weighted moving average

Period Actual Demand Forecast Sum of
January 21 weights
( 3+2+1) = 6
February 25
March 29
April 21 ((29x3)+(25x 2)+(21x 1))= 26
6
May 25 ((21x3) +(29x2) +(25x1))= 24
6
June 20 ((25x 3)+(21x2)+ (29x1)) = 24
6
July 18 ((20×3)+(25×2)+(22×1))/6= 22
 August 21 ((18×3)+(20×2)+(25×1))/6=19.83
September 20 ((21×3)+(18×2)+(20×1))/6=19.83
October 19 ((20×3)+(21×2)+(18×1)/6=20
November 18 ((19×3)+(20×2)+(22×1)/6=19.83
December 15 ((18×3)+(19×2)+(20×1)/6= 18.67

Four-Period Weighted Moving Average

Deman Supply Forecast
d
1 35
2 50
3 65
4 55
5 70 (55x4) + (65x3) + (50x2) +( 35x 1) = 55
10
6 75 (70×4)+(55×3)+(65×2)+(50×1)/10=62.5

II. ASSIGNMENT

1. Use quantitative forecast methods for the data shown below:

Period 1 2 3 4 5 6 7
Observatio 24 34 36 37 41 44 45
n

Compute For:
a. Naïve Method

Forecast Observation Perio

d
24 1
24 34 2
34 36 3
36 37 4
37 41 5
41 44 6
44 45 7
b. Three-period Perio Observation Forecast Moving Average
d
1 24
2 34
3 36
4 37 (24+34+36)/3= 31.33
5 41 (34+36+37)/3= 35.67
6 44 (36+37+41)/3= 38
7 45 (37+41+44)/3= 40.67
C. Three- period Weighted Moving Average

Perio Observation Forecast

d
1 24
2 34
3 36
4 37 (36×3)+(34×2)+(24×1)/6= 33.33
5 41 (37×3)+(36×2)+(34×1)/6= 36.17
6 44 (42×3)+(37×2)+(36×1)/6= 38.88
7 45 (44×3)+(42÷2)+(36×1)/6= 41.83

d. Four-period Moving Average

Perio Observation Forecast

d
1 24
2 34
3 36
4 37
5 41 (24+34+36+37)/4= 33.75
6 44 (34+36+37+41)/4= 37
7 45 (36+37+41+44)/4= 39.5
e. Four-period Weighted Moving
Average

Period Observation Forecast

1 24
2 34
3 36
4 37
5 41 (37×4)+(36×3)+(34×2)+(24×1)/10= 34.8
6 44 (41×4)+(37×3)+(36×2)+34×1)/10= 38.1
7 45 (44×4)+(42÷3)+(36×2)+(46×1)/10= 40.9
 2. Suppose that the University had the following data of its growth of enrollment from 2006
– 20014.
Year Enrollment
2006 3000
2007 3200
2008 3600
2009 3650
2010 4000
2011 4200
2012 4300
2013 4410
2014 4520

a. Forecast the 2015 enrollment using three-year weighted moving average forecast.

Year Enrollment
200 3000
6
200 3200
7
200 3600
8
200 3650
9
201 4000
0
201 4200
1
201 4300
2
201 4410
3
201 4520
4
201 (4520×3)+(4410×2)+(4300×1)/6= 4446.67
5

b. Using smooth α= 0.30, forecast the 2015 enrollment.

Ft= 4,410 + 0.30(4,520-4,410)

= 4,410+ 33
= 4,443
c. Use four-year weighted moving average from 2010 t0 2015
 Year Enrollment Forecast
200 3000
6
200 3200
7
200 3600
8
200 3650
9
201 4000
0
201 4200
1
201 4300
2
201 4410
3
201 4520 (4410×4)+(43000×3)+(4300×2)+(4000×1)/10=
4 4294
201 (4520×4)+(4410×3)+(4300×2)+(4200×1)/10= 4411
5

3. The Javill Department Store has been an authorized dealer for flat TV for the past 5
years. The number of flat TV sold each year is shown in the table.

Year No. Flat TV Sold

1 40
2 25
3 35
4 39
5 43

a. Develop an equation for the linear trend component of the time series.
Year t No. Flat TV t² tY
Sold
1 1 40 1 40
2 2 25 4 50
3 3 35 9 105
4 4 39 16 156
5 5 43 25 215
b =
t=15 Y= 182 Σt²=55 ΣtY=566 nŦ2
b= 566- 5(3)(36.4)/ 55- 5(3)²
b= 556-546/ 55- 45
b= 20/10
b=2

a = Ȳ - bŦ
a= 36.4- 2(3)
a= 36.4- 6
a= 30.4

b. Use the developed trend equation from (b) to prepare for the sales in Year 6 and
year 7.

Yt = a + bt
Yt = 30.4 + 2t
Y6 = 30.4 + 2 (6)
Y6= 42.4

Yt = a + bt
Yt = 30.4 + 2t
Y7= 30.4+ 2 (7)
Y7= 44.4