A six-month moving average forecast is generally better than a three-month moving average forecast if demand:
A) is rather stable.
B) has been changing due to recent promotional efforts.
C) follows a downward trend.
D) exceeds one million units per year.
E) follows an upward trend.

Question

Quizplus · Accepted Answer

A six-month moving average forecast is generally better than a three-month moving average forecast if demand is rather stable. This is because a six-month moving average is better suited to smoothing out random fluctuations in demand that may occur over shorter periods of time, such as three months. However, if demand has been changing due to recent promotional efforts or follows an upward/downward trend, a shorter-term moving average forecast may be more appropriate.

A Six-Month Moving Average Forecast Is Generally Better Than a Three-Month