Problems:
Sales of Cool-Man air conditioners have grown steadily during the past five years, as shown in the following table.
|
Year
|
Sales
|
|
1
|
450
|
|
2
|
495
|
|
3
|
518
|
|
4
|
563
|
|
5
|
584
|
a) using exponential smoothing constants of 0.3, 0.6, and 0.9, develop forecasts for years 2 through 6. The sales manager had predicted, before the business started, that year 1's sales would be 410 air conditioners. Which smoothing constant gives the most accurate forecast?
b) Use a three-year moving average forecasting model to forecast sales of Cool-Man air conditioners.
c) Using linear trend analysis, develop a forecasting model for the sales of Cool-Man air conditioners.
d)Which of the methods analyzed here would you use? Explain your answers.