A company wants to produce a weighted moving average forecast for April with the weights 0.40,0.35,and 0.25 assigned to March,February,and January respectively.If the company had demands of 5,000 in January,4,750 in February,and 5,200 in March,then April's forecast is
A)4983.33.
B)4992.50.
C)4962.50.
D)5000.00.

Question

Quizplus · Accepted Answer

To calculate the weighted moving average forecast, we need to multiply each demand by its corresponding weight and then add them up.

April's forecast = (0.40 x 5,200) + (0.35 x 4,750) + (0.25 x 5,000) = 2,080 + 1,662.50 + 1,250 = 4,992.50

Therefore, the best choice is B.

A Company Wants to Produce a Weighted Moving Average Forecast