Danny and Borris make boxes of chocolates for which the demand is uncertain. Danny says, "This is life." On the other hand, Borris believes that there are some demand patterns which could be useful in purchasing sugar, chocolate, and shrimp. (Danny insists on placing a surprise chocolate-covered shrimp in some boxes so that "You never know what you'll get.") Quarterly demand for the last three years follows:
$$\begin{array} { | c | c | c | c | }
\hline \text { Quarter } & \text { Year 1 } & \text { Year 2 } & \text { Year 3 } \
\hline 1 & 3,000 & 3,300 & 3,502 \
\hline 2 & 1,700 & 2,100 & 2,448 \
\hline 3 & 900 & 1,500 & 1,768 \
\hline 4 & 4400 & 5100 & 5882 \
\hline \text { Total } & 10,000 & 12,000 & 13,600 \
\hline
\end{array}$$
A) Use intuition and judgment to estimate quarterly demand for the fourth year.
B) If the expected sales for chocolates are 14,800 boxes for year 4, use the multiplicative seasonal method to prepare a forecast for each quarter of the year. Are any of the quarterly forecasts different from what you thought you would get in part (A)?

Question

Danny and Borris make boxes of chocolates for which the demand is uncertain. Danny says, "This is life." On the other hand, Borris believes that there are some demand patterns which could be useful in purchasing sugar, chocolate, and shrimp. (Danny insists on placing a surprise chocolate-covered shrimp in some boxes so that "You never know what you'll get.") Quarterly demand for the last three years follows:
 $$\begin{array} { | c | c | c | c | } 
\hline \text { Quarter } & \text { Year 1 } & \text { Year 2 } & \text { Year 3 } \
\hline 1 & 3,000 & 3,300 & 3,502 \
\hline 2 & 1,700 & 2,100 & 2,448 \
\hline 3 & 900 & 1,500 & 1,768 \
\hline 4 & 4400 & 5100 & 5882 \
\hline \text { Total } & 10,000 & 12,000 & 13,600 \
\hline
\end{array}$$ 
A) Use intuition and judgment to estimate quarterly demand for the fourth year.
B) If the expected sales for chocolates are 14,800 boxes for year 4, use the multiplicative seasonal method to prepare a forecast for each quarter of the year. Are any of the quarterly forecasts different from what you thought you would get in part (A)?

Quizplus · Accepted Answer

The Answer of Danny and Borris make boxes of chocolates for which the demand is uncertain. Danny says, "This is life." On the other hand, Borris believes that there are some demand patterns which could be useful in purchasing sugar, chocolate, and shrimp. (Danny insists on placing a surprise chocolate-covered shrimp in some boxes so that "You never know what you'll get.") Quarterly demand for the last three years follows:
 $$\begin{array} { | c | c | c | c | } 
\hline \text { Quarter } & \text { Year 1 } & \text { Year 2 } & \text { Year 3 } \
\hline 1 & 3,000 & 3,300 & 3,502 \
\hline 2 & 1,700 & 2,100 & 2,448 \
\hline 3 & 900 & 1,500 & 1,768 \
\hline 4 & 4400 & 5100 & 5882 \
\hline \text { Total } & 10,000 & 12,000 & 13,600 \
\hline
\end{array}$$ 
A) Use intuition and judgment to estimate quarterly demand for the fourth year.
B) If the expected sales for chocolates are 14,800 boxes for year 4, use the multiplicative seasonal method to prepare a forecast for each quarter of the year. Are any of the quarterly forecasts different from what you thought you would get in part (A)?

Danny and Borris Make Boxes of Chocolates for Which the Demand