Question: A warehouse manager wants to estimate the inventory moving in and out of his warehouse each week. An analyst suggests using a 3-, 5-, or

A warehouse manager wants to estimate the inventory moving in and out of his warehouse each week. An analyst suggests using a 3-, 5-, or 7-week moving average. However, before deciding, he wants to compare the accuracy of each for the most recent 10-week period.

WEEK ACTUAL INVENTORY (IN THOUSANDS EURO) WEEK ACTUAL INVENTORY (IN THOUSANDS EURO)

a) Calculate the 3-, 5-, and 7-week moving average.
b) Calculate MAD for each forecast. Which is the best choice?
c) Calculate the cash demand for week 18th, based on part (b).

WEEK ACTUAL INVENTORY (IN THOUSANDS EURO) WEEK ACTUAL INVENTORY (IN THOUSANDS EURO) 1 2 3 4 5 7 8 9 10 99 98 96 109 104 129 80 100 111 88 62 11 12 13 14 15 16 17 107 97 114 121 78 94 99

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