Actual demand for a product for the past three months was Three months ago 400 u

Question

Actual demand for a product for the past three months was Three months ago 400 units Two months ago 350 units Last month 325 units a. Using a simple three-month moving average, make a forecast for this month. (Round your answer to the nearest whole number.) Forecast for this month units b. If 300 units were actually demanded this month, what would your forecast be for next month? Forecast for the next month units c. Using simple exponential smoothing, what would your forecast be for this month if the exponentially smoothed forecast for three months ago was 450 units and the smoothing constant was 0.20? (Round your answer to the nearest whole number.) Need help with exponential smoothing

Explanation / Answer

Solution-a

Forecast demand (This Month) = 400 + 350 +325 / 3

Forecast demand (This Month) =358.33

Solution-b

Forecast demand (Next Month) = 350 +325 +300 / 3

Forecast demand (Next Month) = 325

Solution-c

Forecast demand (Two Month ago) =  450+0.2*(400-450)

Forecast demand (Two Month ago) = 460

Forecast demand (Last Month) = 460+0.2*(350-460)

Forecast demand (Last Month) = 438

Forecast demand (This Month) = 350+0.2*(325-438)

Forecast demand (This Month) = 327.40

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