In Q1, a firm sold 23,000 units of a particular product. In Q2, the firm sold 25,000, and in Q3 22,850 units were sold. Assume weights of 0.5, 0.3, and 0.2 (descending for older data). What is the three period weighted moving average forecast for Q4?
A) 23,616
B) 23,525
C) 22,850
D) Forecast for Q4 cannot be determined from the information given

Question

Quizplus · Accepted Answer

To calculate the three period weighted moving average forecast for Q4, we need to use the following formula:

Forecast for Q4 = (0.5 * Q1 sales) + (0.3 * Q2 sales) + (0.2 * Q3 sales)

Substituting the given numbers:

Forecast for Q4 = (0.5 * 23,000) + (0.3 * 25,000) + (0.2 * 22,850) = 11,500 + 7,500 + 4,570 = 23,570

Therefore, the closest option to this value is B) 23,525, which is the best choice.

In Q1, a Firm Sold 23,000 Units of a Particular