Skip to main content
Business LibreTexts

3.8: End of Chapter Problems

  • Page ID
    117741
  • \( \newcommand{\vecs}[1]{\overset { \scriptstyle \rightharpoonup} {\mathbf{#1}} } \)

    \( \newcommand{\vecd}[1]{\overset{-\!-\!\rightharpoonup}{\vphantom{a}\smash {#1}}} \)

    \( \newcommand{\id}{\mathrm{id}}\) \( \newcommand{\Span}{\mathrm{span}}\)

    ( \newcommand{\kernel}{\mathrm{null}\,}\) \( \newcommand{\range}{\mathrm{range}\,}\)

    \( \newcommand{\RealPart}{\mathrm{Re}}\) \( \newcommand{\ImaginaryPart}{\mathrm{Im}}\)

    \( \newcommand{\Argument}{\mathrm{Arg}}\) \( \newcommand{\norm}[1]{\| #1 \|}\)

    \( \newcommand{\inner}[2]{\langle #1, #2 \rangle}\)

    \( \newcommand{\Span}{\mathrm{span}}\)

    \( \newcommand{\id}{\mathrm{id}}\)

    \( \newcommand{\Span}{\mathrm{span}}\)

    \( \newcommand{\kernel}{\mathrm{null}\,}\)

    \( \newcommand{\range}{\mathrm{range}\,}\)

    \( \newcommand{\RealPart}{\mathrm{Re}}\)

    \( \newcommand{\ImaginaryPart}{\mathrm{Im}}\)

    \( \newcommand{\Argument}{\mathrm{Arg}}\)

    \( \newcommand{\norm}[1]{\| #1 \|}\)

    \( \newcommand{\inner}[2]{\langle #1, #2 \rangle}\)

    \( \newcommand{\Span}{\mathrm{span}}\) \( \newcommand{\AA}{\unicode[.8,0]{x212B}}\)

    \( \newcommand{\vectorA}[1]{\vec{#1}}      % arrow\)

    \( \newcommand{\vectorAt}[1]{\vec{\text{#1}}}      % arrow\)

    \( \newcommand{\vectorB}[1]{\overset { \scriptstyle \rightharpoonup} {\mathbf{#1}} } \)

    \( \newcommand{\vectorC}[1]{\textbf{#1}} \)

    \( \newcommand{\vectorD}[1]{\overrightarrow{#1}} \)

    \( \newcommand{\vectorDt}[1]{\overrightarrow{\text{#1}}} \)

    \( \newcommand{\vectE}[1]{\overset{-\!-\!\rightharpoonup}{\vphantom{a}\smash{\mathbf {#1}}}} \)

    \( \newcommand{\vecs}[1]{\overset { \scriptstyle \rightharpoonup} {\mathbf{#1}} } \)

    \( \newcommand{\vecd}[1]{\overset{-\!-\!\rightharpoonup}{\vphantom{a}\smash {#1}}} \)

    \(\newcommand{\avec}{\mathbf a}\) \(\newcommand{\bvec}{\mathbf b}\) \(\newcommand{\cvec}{\mathbf c}\) \(\newcommand{\dvec}{\mathbf d}\) \(\newcommand{\dtil}{\widetilde{\mathbf d}}\) \(\newcommand{\evec}{\mathbf e}\) \(\newcommand{\fvec}{\mathbf f}\) \(\newcommand{\nvec}{\mathbf n}\) \(\newcommand{\pvec}{\mathbf p}\) \(\newcommand{\qvec}{\mathbf q}\) \(\newcommand{\svec}{\mathbf s}\) \(\newcommand{\tvec}{\mathbf t}\) \(\newcommand{\uvec}{\mathbf u}\) \(\newcommand{\vvec}{\mathbf v}\) \(\newcommand{\wvec}{\mathbf w}\) \(\newcommand{\xvec}{\mathbf x}\) \(\newcommand{\yvec}{\mathbf y}\) \(\newcommand{\zvec}{\mathbf z}\) \(\newcommand{\rvec}{\mathbf r}\) \(\newcommand{\mvec}{\mathbf m}\) \(\newcommand{\zerovec}{\mathbf 0}\) \(\newcommand{\onevec}{\mathbf 1}\) \(\newcommand{\real}{\mathbb R}\) \(\newcommand{\twovec}[2]{\left[\begin{array}{r}#1 \\ #2 \end{array}\right]}\) \(\newcommand{\ctwovec}[2]{\left[\begin{array}{c}#1 \\ #2 \end{array}\right]}\) \(\newcommand{\threevec}[3]{\left[\begin{array}{r}#1 \\ #2 \\ #3 \end{array}\right]}\) \(\newcommand{\cthreevec}[3]{\left[\begin{array}{c}#1 \\ #2 \\ #3 \end{array}\right]}\) \(\newcommand{\fourvec}[4]{\left[\begin{array}{r}#1 \\ #2 \\ #3 \\ #4 \end{array}\right]}\) \(\newcommand{\cfourvec}[4]{\left[\begin{array}{c}#1 \\ #2 \\ #3 \\ #4 \end{array}\right]}\) \(\newcommand{\fivevec}[5]{\left[\begin{array}{r}#1 \\ #2 \\ #3 \\ #4 \\ #5 \\ \end{array}\right]}\) \(\newcommand{\cfivevec}[5]{\left[\begin{array}{c}#1 \\ #2 \\ #3 \\ #4 \\ #5 \\ \end{array}\right]}\) \(\newcommand{\mattwo}[4]{\left[\begin{array}{rr}#1 \amp #2 \\ #3 \amp #4 \\ \end{array}\right]}\) \(\newcommand{\laspan}[1]{\text{Span}\{#1\}}\) \(\newcommand{\bcal}{\cal B}\) \(\newcommand{\ccal}{\cal C}\) \(\newcommand{\scal}{\cal S}\) \(\newcommand{\wcal}{\cal W}\) \(\newcommand{\ecal}{\cal E}\) \(\newcommand{\coords}[2]{\left\{#1\right\}_{#2}}\) \(\newcommand{\gray}[1]{\color{gray}{#1}}\) \(\newcommand{\lgray}[1]{\color{lightgray}{#1}}\) \(\newcommand{\rank}{\operatorname{rank}}\) \(\newcommand{\row}{\text{Row}}\) \(\newcommand{\col}{\text{Col}}\) \(\renewcommand{\row}{\text{Row}}\) \(\newcommand{\nul}{\text{Nul}}\) \(\newcommand{\var}{\text{Var}}\) \(\newcommand{\corr}{\text{corr}}\) \(\newcommand{\len}[1]{\left|#1\right|}\) \(\newcommand{\bbar}{\overline{\bvec}}\) \(\newcommand{\bhat}{\widehat{\bvec}}\) \(\newcommand{\bperp}{\bvec^\perp}\) \(\newcommand{\xhat}{\widehat{\xvec}}\) \(\newcommand{\vhat}{\widehat{\vvec}}\) \(\newcommand{\uhat}{\widehat{\uvec}}\) \(\newcommand{\what}{\widehat{\wvec}}\) \(\newcommand{\Sighat}{\widehat{\Sigma}}\) \(\newcommand{\lt}{<}\) \(\newcommand{\gt}{>}\) \(\newcommand{\amp}{&}\) \(\definecolor{fillinmathshade}{gray}{0.9}\)

    Problem #1

    Below are monthly sales of light bulbs from the lighting store.

    Month Sales
    Jan 255
    Feb 298
    Mar 357
    Apr 319
    May 360
    June  

    .
    Forecast sales for June using the following

    1. Naïve method
    2. Three- month simple moving average
    3. Three-month weighted moving average using weights of .5, .3 and .2
    4. Exponential smoothing using an alpha of .2 and a May forecast of 350.

    Solution

    1. 360
    2. (357 + 319 + 360) / 3 = 345.3
    3. 360 x .5 + 319 x .3 + 357 x .2 = 347.1
    4. 350 + .2(360 – 350) = 352

    Problem #2

    Demand for aqua fit classes at a large Community Center are as follows for the first six weeks of this year.

    Week Demand
    1 162
    2 158
    3 138
    4 190
    5 182
    6 177
    7  

    .
    You have been asked to experiment with several forecasting methods. Calculate the following values:

    1. a) Forecast for weeks 3 through week 7 using a two-period simple moving average
    2. b) Forecast for weeks 4 through week 7 using a three-period weighted moving average with weights of .6, .3 and .1
    3. c) Forecast for weeks 4 through week 7 using exponential smoothing. Begin with a week 3 forecast of 130 and use an alpha of .3

    Solution

    Week

    Demand

    a)

    b)

    c)

    1

    162

         

    2

    158

         

    3

    138

    (162 + 158) / 2 = 160

     

    130

    4

    190

    (158 + 138) / 2 = 148

    138 x .6 + 158 x .3 + 162 x .1 = 146.4

    130 + .3 x (138 – 130) = 132.4

    5

    182

    (138 + 190) / 2 = 164

    190 x .6 + 138 x .3 + 158 x .1 = 171.2

    132.4 + .3 x (190 – 132.4) = 149.7

    6

    177

    (190 + 182) / 2 = 186

    182 x .6 + 190 x .3 + 138 x .1 = 180

    149.7 + .3 x (182 – 149.7) = 159.4

    7

     

    (182 + 177) / 2 = 179.5

    177 x .6 + 182 x .3 + 190 x .1 = 179.8

    159.4 + .3 x (177 – 159.4) = 164.7

    Problem #3

    Sales of a new shed has grown steadily from the large farm supply store. Below are the sales from the past five years. Forecast the sales for 2018 and 2019 using exponential smoothing with an alpha of .4. In 2015, the forecast was 360. Calculate a forecast for 2016 through to 2020.

    Year

    Sales

    Forecast

    2015

    348

    360

    2016

    372

     

    2017

    311

     

    2018

    371

     

    2019

    365

     

    2020

       

    .
    Solution

    Year

    Sales

    Forecast

    2015

    348

    360

    2016

    372

    360 + .4 x (348 – 360) = 355.2

    2017

    311

    355.2 + .4 x (372 – 355.2) = 361.9

    2018

    371

    361.9 + .4 x (311 – 361.9) = 341.6

    2019

    365

    341.6 + .4 x (371 – 341.6) = 353.3

    2020

     

    353.3 + .4 x (365-353.3) = 358.0

    Problem #4

    Below is the actual demand for X-rays at a medical clinic. Two methods of forecasting were used. Calculate a mean absolute deviation for each forecast method. Which one is more accurate?

    Week Actual Demand Forecast #1 Forecast #2
    1 48 50 50
    2 65 55 56
    3 58 60 55
    4 79 70 85

    Solution

    Week

    Actual Demand

    Forecast #1

    IerrorI

    Forecast #2

    IerrorI

    1

    48

    50

    2

    50

    2

    2

    65

    55

    10

    56

    9

    3

    58

    60

    2

    55

    3

    4

    79

    70

    9

    85

    6

       

    Mean Abs Deviation:

    5.75

    Mean Abs Deviation:

    5


    3.8: End of Chapter Problems is shared under a CC BY-NC 4.0 license and was authored, remixed, and/or curated by LibreTexts.

    • Was this article helpful?