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The following gives the number of oak desks sold during each of the last four months by a furniture store.
Month Desks Sold
May 60
June 54
July 50
August 55
a. Using a four-period weighted moving average, with weights w1 = .5, w2 = .2, w3 = .2 and w4 = .1, forecast the number of desks to be sold in September.
b. Using a two-period simple moving average, forecast the number of desks to be sold in September.
c. Using simple exponential smoothing with an initial forecast for May of 50 and smoothing constant α = 0.4, forecast the number of desks to be sold in September. If you also had to make a forecast for October (two months from now), what would it be?
d. Which of the forecasting methods used in part (b) and part (c) above will be more responsive to changes in demand?
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