1. Sales for a product for the past three months have been 200, 350, and 287. Use a three-month moving average to calculate a forecast for the fourth month. If the actual demand for month 4 turns out to be 300, calculate the forecast for month 5.

2. Lauren's Beauty Boutique has experienced the following weekly sales:

Week |
Sales |

1 | 432 |

2 | 396 |

3 | 415 |

4 | 458 |

5 | 460 |

Forecast sales for week 6 using the naïve method, a simple average, and a three-period moving average.

3. Hospitality Hotels forecasts monthly labor needs.

- (a) Given the following monthly labor figures, make a forecast for June using a three-period moving average and a fiveperiod moving average.
**Month****Actual Values**January 32 February 41 March 38 April 39 May 43 - (b) What would be the forecast for June using the naïve method?
- (c) If the actual labor figure for June turns out to be 41, what would be the forecast for July using each of these models?
- (d) Compare the accuracy of these models using the mean absolute deviation (
*MAD*). - (e) Compare the accuracy of these models using the mean squared error (
*MSE*).

4. The following data are monthly sales of jeans at a local department store. The buyer would like to forecast sales of jeans for the next month, July.

- (a) Forecast sales of jeans for March through June using the naïve method, a two-period moving average, and exponential smoothing with an α = 0.2. (
*Hint*: Use naïve to start the exponential smoothing process.) - (b) Compare the forecasts ...

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