Practical Management Science
Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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Subpart A  : Moving constant = 0.30

Sales of Cool-Man air conditioners have grown steadily during the past 5 years:
Year
1
2
3
4
5
6
7
8
9
10
11
Demand for
Fertilizer
(1,000 bags)
4
6
4
5
10
8
7
9
12
14
15
a)
b)
The sales manager had predicted, before the business started, that year I's sales would be 410 air
conditioners. Using exponential smoothing with a weight of develop forecasts for years 2 through 6.
Using smoothing constants of 0.6 and 0.9, develop forecasts for the sales of Cool-Man air conditioners.
What effect did the smoothing constant have on the forecast for Cool-Man air conditioners? Which
smoothing constant gives the most accurate forecast?
c)
d)
f)
Use a three-year moving average forecasting model to forecast the sales of Cool-Man air conditioners.
e) Using the trend projection method, develop a forecasting model for the sales of Cool-Man air conditioners.
Would you use exponential smoothing with a smoothing constant of 0.3, a 3-year moving average, or a
trend to predict the sales of Cool-Man air conditioners?
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Transcribed Image Text:Sales of Cool-Man air conditioners have grown steadily during the past 5 years: Year 1 2 3 4 5 6 7 8 9 10 11 Demand for Fertilizer (1,000 bags) 4 6 4 5 10 8 7 9 12 14 15 a) b) The sales manager had predicted, before the business started, that year I's sales would be 410 air conditioners. Using exponential smoothing with a weight of develop forecasts for years 2 through 6. Using smoothing constants of 0.6 and 0.9, develop forecasts for the sales of Cool-Man air conditioners. What effect did the smoothing constant have on the forecast for Cool-Man air conditioners? Which smoothing constant gives the most accurate forecast? c) d) f) Use a three-year moving average forecasting model to forecast the sales of Cool-Man air conditioners. e) Using the trend projection method, develop a forecasting model for the sales of Cool-Man air conditioners. Would you use exponential smoothing with a smoothing constant of 0.3, a 3-year moving average, or a trend to predict the sales of Cool-Man air conditioners?
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