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A can opener manufacturer has had monthly sales for a seven-month period as follows:
Month Sales
Feb. 1256
Mar. 1602
Apr. 2376
May 1844
Jun. 2231
Jul. 2716
Aug. 1793
a) Plot the monthly data
b) Forecast September’s sales using each of the following:
1. A linear trend equation. (Use of Excel’s regression).
2. A three-month simple moving average.
3. Exponential smoothing with a smoothing constant equal to 0.1, and a starting forecast for May of 2093
4. A three-month weighted average using 0.1 for August, 0.1 for July, and 0.80 for June.
c) Which forecast method seems most appropriate? Why?
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