Problem 15 Burger Lover Restaurant forecasts weekly sales of cheeseburgers. Chee
ID: 3366525 • Letter: P
Question
Problem 15 Burger Lover Restaurant forecasts weekly sales of cheeseburgers. Cheeseburger Sales Week sa 355 341 371 317 361 4 Based on historical observations over the past five weeks, make a forecast for the next period using the following methods: simple average, three-period moving average, and exponential smoothing with a 0.4, given a forecast of 324 cheeseburgers for the fifth week. Round your answers to 2 decimal places, the tolerance is +/-0.01 Simple average: F6 3-Period moving average: F6 Exponential smoothing: F6 If actual sales for week 6 turn out to be 370, compare the three forecasts using MAD. Which method performed best? (Calculate your answers using the error only in period 6.) MAD (simple average)Explanation / Answer
Simple average = (355 + 341 + 371 + 317 + 361)/5 = 349
3 - Period moving average = (371 + 317 + 361)/3 = 349.67
Exponential smoothing = 0.4 * 361 + 0.6 * 324 = 338.8
MAD (Simple average) = 370 - 349 = 21
3 - Period moving average = 370 -349.67 = 20.33
Exponential smoothing = 370 - 338.8 = 31.2