Pumpkin Pies Galore is trying to forecast sales of pies for the month of December. Demand for pies in September, October, and November has been 217, 316, and 396, respectively. Edith, the company’s owner, uses a three-period weighted moving average to forecast sales. Based on her experience, she chooses to weight September as 0.1, October as 0.3, and November as 0.6. (Round your answers to 1 decimal place, the tolerance is +/-0.1.)
What would Edith’s forecast for December be?
Forecast using a weighted moving average =
What would her forecast be using the naive method?
Forecast using the naïve approach =
If actual sales for December turned out to be 436 pies, which method was better (use MAD)?
Absolute deviation using a weighted moving average =
Absolute deviation using naïve method = (For computation use only December data.)