(A) Suppose that actual demands during April and May are as follows: May, 5500 cans; June 4500 cans. After observing May's demand, what is the forecast for June's demand?
(B) Based on the data from (A), the demands during April and May average (5500+4500)/2 = 5000 cans per month. This is the same as the forecast for monthly sales before we observed the April and May data. Yet after we observed the April and May demands for Pepsi, our forecast for June demand has decreased from what it was at the end of March. Why?
Correct Answer:
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The forecast for June demand is 495...View Answer
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