Question: To solve this problem, I will: Compute the three - period and four - period moving averages for weeks 5 , 6 , and 7
To solve this problem, I will:
Compute the threeperiod and fourperiod moving averages for weeks and
Calculate the mean absolute deviation MAD for each forecasting method to determine which is more accurate.
Use the more accurate method to forecast week
ThreePeriod Moving Average:
Week forecast
Week forecast
Week forecast
FourPeriod Moving Average:
Week forecast
Week forecast
Week forecast
Calculating MAD for ThreePeriod:
Forecast ErrorActual Forecast
Week :
Week :
Week :
MAD
Calculating MAD for FourPeriod:
Week :
Week :
Week :
MAD
The fourperiod moving average has a lower MAD of so it is the more accurate forecasting method.
To forecast week using the fourperiod method:
Week forecast X
Where X is the actual sales for week which we don't know.
So using just the known sales data:
Week forecast
Therefore, using the more accurate fourperiod moving average method, the forecast for week sales is cases.
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