As demand increased the company switched to manufacturing standard electronic components based on manufacturers who were mass
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Question:
To cope with these issues the company decided to incorporate principles of demand forecasting to guide production planning with the expectation that this would lead to more efficient procurement of raw materials and scheduling of production staff. The data below provided below relates to actual sales over several periods:
Period 1 600
Period 2 720
Period 3 950
Period 4 1100
Period 5 850
Period 6 1200
Describe THREE (3) components of a demand forecast. Ensure your description explains how each element may impact the outcome of the demand forecast. (6 marks)
Given that the forecast for period 1 was 400 units, use exponential smoothing to forecast demand for the data relating to Pones Ltd for periods 2 to 6 based on an exponential smoothing constant of 0.80. (5 marks)
Use the MAD to calculate the relative accuracy of the demand forecast. (3 marks)
Related Book For
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
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