When the moving average method is used to estimate the seasonal factors with quarterly sales data,a ______ period moving average is used.
A) 2
B) 3
C) 4
D) 5
E) 8

Question

Quizplus · Accepted Answer

When using quarterly data, seasonal factors are typically estimated using a 4-period moving average. This means that the seasonal factor for each quarter is calculated as the average of that quarter's sales over the past 4 years. Using a longer or shorter moving average can result in over-smoothing or under-smoothing the seasonal pattern, respectively. Therefore, a 4-period moving average is the best choice for estimating seasonal factors with quarterly sales data.

When the Moving Average Method Is Used to Estimate the Seasonal