National Scan Inc sells radio frequency inventory tags Month

National Scan, Inc., sells radio frequency inventory tags. Monthly sales for a seven-month period were as follows:

A linear trend equation.(Round your intermediate calculations and final answer to 2 decimal places.)

A five-month moving average. (Round your answer to 2 decimal places.)

Exponential smoothing with a smoothing constant equal to .20, assuming a March forecast of 16(000). (Round your intermediate forecast values and final answer to 2 decimal places)

A weighted average using .70 for August, .10 for July, and .20 for June. (Round your answer to 2 decimal places.)

Solution

Linear trend equation fitted :

Y = 1.178 X + 15.571

Prediction for Sep, X = 8,

Y = 25

The next three are done in the table :

Thus,

5 -month moving average forecast = 21 (which is the simple arithmetic mean od months from April to august

Naive forecast = 24 (which is just the previous month sales)

Exponential smoothing = (alpha)*(previous sales) + (1 - alpha)*(previous forecast)

Weighted moving average value = 0.7(24) + 0.1(25) + 0.2(16)

= 22.5

Hope this helps. Ask if you have any doubts