Demand for Fertilizer (ton) 105 Year Quarter 1 1 2 150 3 93 4 121 2 5 140 6 170 7 105 150 150 170 9 10 11 110 12 130 3.
The LawnPlus Fertilizer Company distributes fertilizer to
various lawn and garden shops. The company must base its
quarterly production schedule on a forecast of how many
tons of fertilizer will be demanded from it. The company
has gathered the following data for the past three years
from its sales records.
a. Compute a three-quarter moving average forecast for
quarters 4 through 13 and compute the forecast error
for each quarter.
b. Compute a five-quarter moving average forecast for
quarters 6 through 13 and compute the forecast error
for each quarter.
c. Compute a weighted three-quarter moving average
forecast using weights of 0.50, 0.33, and 0.17 for the
most recent, next recent, and most distant data, respec-
tively, and compute the forecast error for each quarter.
d. Compare the forecasts developed in parts (a), (b), and
(c) using cumulative error. Which forecast appears to
be most accurate? Do any exhibit any bias?
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