The table below shows monthly sales of a motorcycle store during the last two ye
ID: 449619 • Letter: T
Question
The table below shows monthly sales of a motorcycle store during the last two years. The commission for each motorcycle sale is $1,000. The manager wants to estimate how much money he will need for month 25.
Month
Sales
Month
Sales
1
195
13
155
2
210
14
120
3
190
15
135
4
170
16
110
5
180
17
122
6
156
18
97
7
134
19
85
8
155
20
110
9
145
21
85
10
165
22
78
11
128
23
66
12
135
24
45
a. Plot and analyze your data.
b. Forecast motorcycle sales and amount of money needed for month 25 using the Naïve method.
c. Forecast motorcycle sales and amount of money needed for month 25 using MA3.
d. Forecast motorcycle sales and amount of money needed for month 25 using MA4.
e. Forecast motorcycle sales and amount of money needed for month 25 using ES with =0.2.
f. Forecast motorcycle sales and amount of money needed for month 25 using ES with =0.6.
Month
Sales
Month
Sales
1
195
13
155
2
210
14
120
3
190
15
135
4
170
16
110
5
180
17
122
6
156
18
97
7
134
19
85
8
155
20
110
9
145
21
85
10
165
22
78
11
128
23
66
12
135
24
45
Explanation / Answer
a)
b) Naive Approach - Amount of money needed in the month 25 = amount of money in the most recent period i.e month 24 = $45000
Sales= 45
c) Amount of money in the month 25 = Moving average of last three months = ( 78000 + 66000 + 45000 )/ 3 = $63000
Sales = 63
d) Amount of money in the month 25 = Moving average of last four months = ( 85000+ 78000 + 66000 + 45000 )/ 4 = $68500 which is to be rounded off to $69000 as the number of motorcycles has to be a whole number
Sales = 68.5 rounded off to 69
e) For exponential smoothing method we would need the forecast for the 24th month which hasn't been provided in the question. So let's assume the forecast for the 24th month to be a moving average for the last four periods which = $84750
Therefore, amount of money for the 25th Month = forecast value of 24th month + 0.2 ( actual value of 24th month - forecast value of 24th month) = 84750 + 0.2 (45000 - 84750) = $76800 rounded off to $77000
Sales = 76.8 rounded off to 77
f) Similary, Amount of money for the 25th Month = forecast value of 24th month + 0.6 ( actual value of 24th month - forecast value of 24th month) = 84750 + 0.6 (45000 - 84750) = $60900 rounded off to $61000
Sales = 60.9 rounded off to 61
Month Sales Money Earned 1 195 195000 2 210 210000 3 190 190000 4 170 170000 5 180 180000 6 156 156000 7 134 134000 8 155 155000 9 145 145000 10 165 165000 11 128 128000 12 135 135000 13 155 155000 14 120 120000 15 135 135000 16 110 110000 17 122 122000 18 97 97000 19 85 85000 20 110 110000 21 85 85000 22 78 78000 23 66 66000 24 45 45000Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.