2
Subject:BusinessPrice: Bought3
2. National Scan, Inc., sells radio frequency inventory tags. Monthly sales for a seven-month period were as follows:
|
Month |
Sales (000 units) |
|
Feb. |
19 |
|
Mar. |
18 |
|
Apr. |
15 |
|
May |
20 |
|
Jun. |
18 |
|
Jul. |
22 |
|
Aug. |
20 |
a. Plot the monthly data on a sheet of graph paper.
b. Forecast September sales volume using each of the following:
1. The naive approach
2. A five-month moving average
3. A weighted average using .60 for August, .30 for July, and .10 for June
4. Exponential smoothing with a smoothing constant equal to .20, assuming a a March forecast of 19(000)
5. A linear trend equation
c. Which method seems least appropriate? Why? (Hint: Refer to your plot from part a.)
d. What does use of the term sales rather than demand presume?
3. A dry cleaner uses exponential smoothing to forecast equipment usage at its main plant. August usage was forecasted to be 88 percent of capacity; actual usage was 89.6 percent of capacity. A smoothing constant of .1 is used.
a. Prepare a forecast for September.
b. Assuming actual September usage of 92 percent, prepare a forecast for October usage.
4. An electrical contractor’s records during the last five weeks indicate the number of job requests:
|
Week |
1 |
2 |
3 |
4 |
5 |
|
Requests |
20 |
22 |
18 |
21 |
22 |
Predict the number of requests for week 6 using each of these methods:
a. Naive
b. A four-period moving average
c. Exponential smoothing with α = .30; use 20 for week 2 forecast
8. Air travel on Mountain Airlines for the past 18 weeks was:
|
Week |
Passengers |
|
1 |
405 |
|
2 |
410 |
|
3 |
420 |
|
4 |
415 |
|
5 |
412 |
|
6 |
420 |
|
7 |
424 |
|
8 |
433 |
|
9 |
438 |
|
10 |
440 |
|
11 |
446 |
|
12 |
451 |
|
13 |
455 |
|
14 |
464 |
|
15 |
466 |
|
16 |
474 |
|
17 |
476 |
|
18 |
482 |
a. Explain why an averaging technique would not be appropriate for forecasting.
b. Use an appropriate technique to develop a forecast for the expected number of passengers for the next three weeks.
