ASSIGNMENT 1 (Demand forecasting on Excel) Question 1 A high-tech company wants to forecast the demand for their Kindle e-readers (in 000), based on the data below. (2 marks) Month 1 2 3 4 5 Demand (000s) 3600 3400 3400 3350 3200 2950 3050 3000 2900 2650 1850 6 7 8 9 10 11 12 13 14 2250 2100 1900 15 1850 1.1 The company wants to choose a forecasting method for its data and considers Simple Moving Average (4 period and 7 period) and Weighted Moving Average (4 period with W1=0.4, W2 = 0.3, W3 = 0.2 and W4 = 0.1). 1.1.1 Using the above forecasting methods, forecast demand till month 15. 1.2 Make a scatter plot of the forecasts obtained with the three methods (4 and 7 period simple moving average and 4 period weighted moving average), together with the actual demand. Comment on the graphs obtained. 1.3 For each of the three methods above, calculate MAD and MAPE. Comment on these values. Which forecasting method should you choose? Why