Question

Using the data below, what is the weighted moving average forecast for the 4th week?

The weights are .20, .30, .50 (oldest period to most recent period)

Week	Time Series Value
1	23.00
2	10.00
3	24.00
4	9.00

Answer Format: Number: Round to: 1 decimal places.

Answer 1

We need to calculate the weighted moving average of the 4th week.

The weights are given as 0.5 for the most recent period that is 3rd week, 0.3 for the older period that is 2nd week and 0.2 for the oldest period that is 1st week. So the three week weighted moving average forecast for the fourth week is given as

F4 = (0.5)*(value for 3rd week) + (0.3)*(value for 2nd week) + (0.2)*(value for 1st week)

= (0.5)(24.0) + (0.3)(10.0) + (0.2)(23.0) = 12 + 3 + 4.6 = 19.6

Hence the weighted moving average forecast for the fourth week is 19.6