Question: QUESTION 4 (20 marks) Table 2.1: Actual sales data for the reading glasses during 2021 Month Actual Sales (Pairs of reading glasses) January 2021 2

QUESTION 4 (20 marks)

Table 2.1: Actual sales data for the reading glasses during 2021

Month Actual Sales (Pairs of reading glasses)

January 2021 2 800

February 2021 3 000

March 2021 5 000

April 2021 4 000

May 2021 5 600

June 2021 8 000

July 2021 8 000

August 2021 7 900

September 2021 6 000

October 2021 4 050

November 2021 4 900

December 2021 5 550

Using the sales data of the reading glasses in Table 2.1 (question 3), answer the following questions:

4.1 Calculate the three-month-weighted-moving-average monthly forecasts for the period April 2021 December 2021. Use weights of 0.5, and 0.2 for the most recent and oldest monthly data respectively and 0.3 for the middle month (show all workings). (9 marks)

4.2 Determine the Mean Absolute Deviation (MAD) of the three-month-weighted-moving-average monthly forecasts for the April - December 2021 period. (4 marks)

a. The linear regression equation of the sales of reading glasses for the 2021 financial year is given by the expression: y = 201.4x + 4091 (where 'y' denotes monthly sales, and 'x', the number representing the month. For example, x = 1, 2, 3, etc., if the month is January, February, March, etc.). Use the regression equation to determine the Mean Absolute Deviation (MAD) of the regression forecasts for the April - December 2021 period. .(5 marks)

b. Which of the two methods is better at forecasting the sales of the reading classes? Explain. (2 marks)

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