John's House of Pancakes uses a weighted moving average method to forecast pancake sales.It assigns a weight of 5 to the previous month's demand,3 to demand two months ago,and 1 to demand three months ago.If sales amounted to 1000 pancakes in May,2200 pancakes in June,and 3000 pancakes in July,what should be the forecast for August?
A)2400
B)2511
C)2067
D)3767
E)1622

Question

Quizplus · Accepted Answer

To calculate the forecast for August using the weighted moving average method, we first need to find the weighted average for the previous three months:

Weighted average = (5 x June sales) + (3 x July sales) + (1 x August sales) / 9

We can plug in the values we have and solve for August sales:

2200(5) + 3000(3) + 1(x) = 9x
11000 + 9000 + x = 9x
2000 = 8x
x = 250

Therefore, the forecast for August sales is 250 + 3000 = 3250 pancakes, which is closest to choice B (2511).

John's House of Pancakes Uses a Weighted Moving Average Method