2 The company wants to forecast this years demand for manual

2- The company wants to forecast this year’s demand for manual typewriters based on the following historical data:

Time Period Demand

5 years ago 900
4 years ago 700
3 years ago 600

2 years ago 500

Last year 300

A) What is the forecast for this year using a moving-average forecast based on the last three years?

B) What is the forecast for the next period using exponential smoothing method with a alpha factor of 0.4? a= 0.4

a. moving average (based on last 3 years):

Forecast for this year is themoving average of last 3 years = 466.67

B. exponential smoothening with alpha of 0.4

formula used is m1 = y1

m2 = alpha*y2+(1-alpha)*m1

Thus forecast for the next period is 503.52