Consider the following monthly sales data for a company: Using the method of mov

Question

Consider the following monthly sales data for a company:

Using the method of moving averages over 5 months, how does the predicted value compare with the actual value for July 2016?

Jan-2015 147772 Feb-2015 144335 Mar-2015 163943 Apr-2015 169634 May-2015 175371 Jun-2015 174825 Jul-2015 176995 Aug-2015 176208 Sep-2015 170202 Oct-2015 175510 Nov-2015 180364 Dec-2015 217629 Jan-2016 154400 Feb-2016 155596 Mar-2016 183782 Apr-2016 181209 May-2016 186359 Jun-2016 189244 Jul-2016 184978 Aug-2016 192925

Explanation / Answer

Please find the data below for a 5 month moving average

From the table it is very clear that the predicted value is greater than the actual value for July 2016.

Month Sales 5 months Jan-15 147772 Feb-15 144335 Mar-15 163943 160211 Apr-15 169634 165621.6 May-15 175371 172153.6 Jun-15 174825 174606.6 Jul-15 176995 174720.2 Aug-15 176208 174748 Sep-15 170202 175855.8 Oct-15 175510 183982.6 Nov-15 180364 179621 Dec-15 217629 176699.8 Jan-16 154400 178354.2 Feb-16 155596 178523.2 Mar-16 183782 172269.2 Apr-16 181209 179238 May-16 186359 185114.4 Jun-16 189244 186943 Jul-16 184978 186943 Aug-16 192925

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