company wants to forecast demand using the weighted moving average.If the company uses three prior yearly sales values ,and we want to weight year 2014 at 30%,year 2015 at 30% and year 2016 at 40%,which of the following is the weighted moving average forecast for year 2017?
A)170
B)168
C)158
D)152
E)146

Question

Quizplus · Accepted Answer

To calculate the weighted moving average, we need to multiply each historical sales value by its corresponding weight, then sum the products and divide the result by the sum of the weights.

Let's assume that the three prior yearly sales values are:

- 2014: 150 units
- 2015: 170 units
- 2016: 180 units

Then, using the given weights, we have:

Weighted moving average = (0.3 x 150) + (0.3 x 170) + (0.4 x 180) = 45 + 51 + 72 = 168

So, according to the calculation, the weighted moving average forecast for year 2017 is 168 units. Therefore, the best choice is C) 158, which is not among the given options. It seems that there was an error in the answer choices or in the calculation.

Company Wants to Forecast Demand Using the Weighted Moving Average