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22 June, 05:07

Given the following history, use a three-quarter moving average to forecast the demand for the third quarter of this year. Note, the 1st quarter is Jan, Feb, and Mar; 2nd quarter Apr, May, Jun; 3rd quarter Jul, Aug, Sep; and 4th quarter Oct, Nov, Dec.

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Last year 100 125 135 175 185 200 150 140 130 200 225 250

This year 125 135 135 190 200 190

Forecast for the third quarter:

+4
Answers (2)
  1. 22 June, 05:21
    0
    The three quarter moving average is 550.

    Explanation:

    Oct 200

    Nov 225

    Dec 250 Sum of (200+225+250) = 675

    Jan 125

    Feb 135

    Mar 135 Sum of (125+135+135) = 395

    Apr 190

    May 200

    Jun 190 Sum of (190+200+190) = 580

    The three quarter moving average is:

    ⇒ (675+395+580)

    3

    ⇒ 550
  2. 22 June, 07:37
    0
    The Forecast demand for the third quarter = 550

    Explanation:

    When using a three-quarter moving average we need data three previous quarters and in order to calculate a quarter average we need monthly data.

    Step 1 : Calculate Average for three quarters prior the current required quarter

    1st quarter's Average = (Oct + Nov * Dec) / 3 = (200+225+250) / 3 = 225

    2nd quarter's Average = (Jan + Feb + Mar) / 3 = (125+135+135) / 3 = 132

    3rd quarter's Average = (Apr + May + Jun) / 3 = (190+200+190) / 3 = 193

    Step 2 : Add all the averages

    Demand Average = 193 + 132 + 225 = 550
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