company wants to forecast demand using the weighted moving average.If the company uses two prior yearly sales values ,and we want to weight year 2015 at 10% and year 2016 at 90%,which of the following is the weighted moving average forecast for year 2017?
A)120
B)128
C)133
D)138
E)142

Question

Quizplus · Accepted Answer

The weighted moving average forecast for year 2017 is 128. This is calculated by taking the sum of the weighted sales values for the two prior years, and then dividing by the sum of the weights. In this case, the weighted sales value for 2015 is 120 * 0.10 = 12, and the weighted sales value for 2016 is 140 * 0.90 = 126. The sum of the weighted sales values is 12 + 126 = 138. The sum of the weights is 0.10 + 0.90 = 1.00. Therefore, the weighted moving average forecast for year 2017 is 138 / 1.00 = 128.

Company Wants to Forecast Demand Using the Weighted Moving Average