Develop a two-period weighted moving average forecast for periods 12-15.

Use weights of 0.7 and 0.3. with the most recent observations weighted higher.

Period Demand

10 274

11 320

12 426

13 294

14 473

Calculate the forecasts for periods 12-15 by using a two-period weighted moving average model.

Period Demand Forecast

10 274

11 320

12 426

13 294

14 473

15

Period Forecast

12 306.2

13 394.2

14 333.6

15 419.3

Explanation:

Weights

Period Demand older 0.3 recent 0.7 Forecast

10 274

11 320

12 426 82.2 (274 x 30%) 224 (320 x 70%) 306.2

13 294 96 (320x30%) 298.2 (426x70%) 394.2

14 473 127.8 (426x30%) 205.8 (294x70%) 333.6

15 88.2 (294x30%) 331.1 (473x70%) 419.3

From the given infroamtion period n forecast will be:

(n-1) x 70% + (n-2) x 30%

Period 13 = Period 12 x 70% + Period 11 x 30%