Problem 10:

Cases of Merlot
Year
Wine
2005
270
2006
356
2007
398
2008
456
2009
358
2010
500
2011
410
2012
376
Given = .20
Using the average demand for 2005 through 2007 as the initial forecast,
hence
F2007 = (270+356+398)/3 = 341.33 Unit
Forecast for year 2008 is
F2008 = F2007 + (A2007-F2007)
F2008 = 341.33+ .20(398-341.33)
= 352.66 Unit
Similarly,
F2009 = 373.33 Unit
F2010 = 370.26 Unit
F2011 = 396.21 Unit
F2012 = 398.97 Unit
Problem 11:
Week
Week
1
Week
2
Week
3
Week
4

Dema
nd
300
400
600
700

(a) Forecasting using moving average method:

FWeek4 = (300+400+600)/3
= 433.33 Unit
FWeek5 = (400+600+700)/3
= 566.66 Unit
(b)Forecasting using exponential smoothing method:

Given, =0.20 & FWeek3= 350

Now,
FWeek4 = FWeek3 + (AWeek3FWeek3)
= 350 + .2 (600-350)
= 400
Similarly,
FWeek5 = 460
Problem 12:
Month
June
July
Augus
t

Dema
nd
140
180
170

(a) Forecasting for September using three-month moving average

method
FSept = (140+180+170)/3 = 163.33
(b)Forecasting for September using weighted moving average method
FSept = .20*140 + .30* 180 + .50*170 = 167
(c) Forecasting for September using exponential smoothing method
FJune = 130
FJuly = 130 + .30 (140-130) = 133
FAug = 133 + .30 (180-133) = 147.1
FSept = 147.1 + .30 (170-147.1) = 153.97
Problem 13:
Month
April
May
June
July
Augus
t
Sept
Oct

Dema F 4-month moving

nd
avg.
60
55
75
60

80
75
72.5

Expon.

65
67

c.
Month
April
May

X
1
2

Y
60
55

X2
1
4

XY
60
110

June
July
Augus
t
Sept
Total

3
4

75
60

9
16

225
240

5
6
21

80
75
405

25
36
91

400
450
1485

= ((91*405) (21*1485))/((6*91)-(21^2)) =54

B = ((6*1485)-(21*405) / ((6*91)-441) =3.85
Trend Line = A+BX
Y = 54 + 3.85 X
(d)Put X=7 in trend line
Y = 54 + 3.85*7 =80.95
Problem 17:
Month
Jan
Fab
Mar
Apr
May
June
Jul
Aug
Sept

Dema F Moving
Deviation
F
nd
Avg.
110
130
150
130
40
170
150
10
160
160
20
180
170
30
140
160
30
130
150
10
140

Expon.

130
136
146.2
150.34
159.24
153.47
146.43

Deviation

20
34
13.8
29.66
19.24
23.47
6.43

(a) Forecasting demand for Apr through Sept using three-month moving
average method
FApr = (110+130+150)/3 = 130
Similarly,
FMay = 150, FJune = 160, FJul =170, FAug = 160, FSept = 150

(a) Forecasting demand for Apr through Sept using simple exponential
smoothing method
Given = .30, FMarch = 130
FApril = 130 + .3 (150-130) = 136
Similary,

FMay = 146.2, FJune = 150.34, FJuly = 159.24, FAug = 153.47, FSept = 146.43
c. MAD Moving Avg. = 140/6 = 23.33
MAD Expo. = 146.6/7 = 20.94
Problem 22:
Mont
F 3-months moving
h
Demand
avg.
1
62
2
65
3
67
4
5
6
7
8
9
10
11
12

68
71
73
76
78
78
80
84
85

Mont
h
Demand
At
1
62
2
65
3
67
4
68
5
71
6
73
7
76
8
78
9
78
10
80
11
84
12
85
MAD
MAD
MAD
MAD

for
for
for
for

month average
wt. average
exponential
Trend

64.66
66.66
68.66
70.66
73.33
75.66
77.33
78.66
80.66

FExpo.

Wt. avg.

61.3
62.41
33.5+19.5+12.
4=65.4
67.1
69.3
71.4
74.4
76.4
77.6
79
81.1

Tt
60
62.76
65.49
67.84
70.4
72.85
75.47
77.96
79.7
81.37
83.61
85.52
= 4.08
= 3.46
= 5.63
= 1.95

1.8
2.088
2.281
2.3
2.38
2.4
2.47
2.47
2.25
2.08
2.13
2.06

63.79
65.05
67.44
69.11
71.18
73.23
74.66
76.26
78.58

Ft (Trend)
61.8
64.848
67.77
70.14
72.78
75.24
77.94
80.43
81.95
83.45
85.74
87.58

As MAD for trend is the least, it will be selected for forecasting