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forecast with moving average or weighted average

Data collected on the yearly demand for 50-pound
bags of fertilizer at Wallace Garden Supply are
shown in the following table. Develop a 3-year moving
average to forecast sales. Then estimate demand
again with a weighted moving average in which
sales in the most recent year are given a weight of 2
and sales in the other 2 years are each given a weight
of 1. Which method do you think is best?
DEMAND FOR FERTILIZER
YEAR (1,000S OF BAGS)
1 4
2 6
3 4
4 5
5 10
6 8
7 7
8 9
9 12
10 14
11 15

Solution Preview

Hi there,

Thanks for allowing me to work on your questions. Here, let's define variable first. For year x, x1=1,x2=2,x3=3,x4=4,x5=5,x6=6,x7=7,x8=8,x9=9,x10=10,x11=11. Meanwhile, demand for fertilizer y, ...

Solution Summary

This solution provides explanation how to perform forecast by using moving average or weighted average.

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