1. A salesperson at a convenience store has been monitoring the demand for 1-gallon milk bottles of a particular brand. The actual demand during the last 5 weeks is shown below:
WEEK |
ACTUAL DEMAND (number of milk bottles sold) |
Five weeks ago |
300 |
Four weeks ago |
310 |
Three weeks ago |
321 |
Two weeks ago |
330 |
One week ago |
340 |
THIS WEEK |
ACTUAL DEMAND NOT KNOWN |
Use trend-adjusted exponential smoothing to obtain the demand forecast for THIS WEEK. Use the following:
Exponentially smoothed forecast five weeks ago = 289 milk bottles
Exponentially smoothed trend estimate five weeks ago = 10 milk bottles
The smoothing constants: = 0.4, = 0.5.
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