Question

The following is the data for the number of complains a telephone company received during the past 5 weeks for the service they offer. Use the data to forecast the number of complaints for week 6, based on the following methods:

Week	Demand
1	111
2	100
3	105
4	112
5	114

Naive approach.
Simple moving average with span of 3.
Weighted moving average with weights of 0.55, 0.25, and 0.2.
Simple exponential smoothing with smoothing factor of 0.4.
Keep two decimal places in your calculations.

Week	Forecast: Naïve	Forecast: Simple Moving Average	Forecast: Weighted Moving Average	Forecast: Exponential Smoothing
1	--	--	--	--
2	--	--	--
3	--	--	--
4	--	--	--
5	--	--	--
6

Answer 1

Naïve forecast is made by using the value for the previous period

3 period moving average is simply the average of the previous three periods

Weighted moving average is the multiplication of weights with the previous actual data.

Exponential smoothing uses the formula F2 = alpha*A1 + (1-alpha)*F1 where F1 and A1 are the forecast and demand for previous period respectively.

The calculated values are shown below

Week	Demand	Naïve	SMA	WMA	ES
1	111				111
2	100	111			111
3	105	100			106.6
4	112	105	105.33	104.95	105.96
5	114	112	105.67	107.85	108.38
6		114	110.33	111.70	110.63