Engineering

Management
EEE 324
Assignment 1- Planning
Obaid Mohammed Alkaabi
201320020



Q1: Sales of a particular product (in thousands of dollars) for the years 2013 through
2016 have been 48, 64, 67, and 83, respectively.
a) What sales would you predict for 2017 using a simple four-year moving average?
(b) What sales would you predict for 2017 using a weighted moving average with weights
of 0.40 for the immediate preceding year and 0.30, 0.2, and 0.1 for the three years
before that?

a- Sales product for 2017 = 48+64+67+83/4 = 65.5
b-
Actual value Weight
48 0.1
64 0.2
67 0.3
83 0.40

Sales Product for 2017 = (48*0.15) + (64*0.20) + (67*0.25) + (83*0.40)
= 7.2 + 12.8 + 16.75 + 33.2 = 69.95
80
70
60
50
Actual Value
40
Weight
30
20
10
0
2009 2010 2011 2012






Q2: Using exponential smoothing with a weight ex of 0.6 on actual values:
(a) if sales are $45,000 and $50,000 for 2014 and 2015, what would you forecast for
2016?
(b) given this forecast and actual 2016 sales of $53,000, what would you then forecast
for2017?

(a) =0.6
Period Actual value Forecast
2014 $ 45,000 -
2015 $ 50,000 $ 45,000
2016 - $ 48,000

F2016 = A2015 + (1- )F2015
F2016 = 0.6*50,000 + (1-0.6)*45,000 = 30,000 + 18,000 = 48,000

(b) given this forecast and actual 2012 sales of $53,000, what would you
then forecast for2013?

Period Actual value Forecast
2014 $ 45,000 -
2015 $ 50,000 $ 45,000
2016 $ 53,000 $ 48,000
2017 - $ 51,000

F2017 = A2016 + (1- )F2016
F2017 = 0.6*53,000 + (1-0.6)*48,000 = 31,800 + 19,200 = 51,000








Q 3: In Q 2, taking actual 2013 sales of $48,000 as the forecast for 2014, what sales
would you forecast for 2015, 2016, and 2017 using exponential smoothing and a weight
based on the actual values of (a) 0.4; (b) 0.7?

(a) 0.4

Period Actual value Forecast
2003 $ 48,000 -
2014 $ 45,000 $ 48,000
2015 $ 50,000 $ 46,800
2016 $ 53,000 $ 48,080
2017 - $ 50,048

F2015 = A2014 + (1- )F2014 = 0.4*45,000 + (1-0.4)*48,000 = 46,800

F2016 = A2015 + (1- )F2015 = 0.4*50,000 + (1-0.4)*46,800 = 48,080

F2017 = A2016 + (1- )F2016 = 0.4*53,000 + (1-0.4)*48,520 = 50,048

(b) 0.7?

Period Actual value Forecast
2009 $ 48,000 -
2010 $ 45,000 $ 48,000
2011 $ 50,000 $ 45,900
2012 $ 53,000 $ 48,770
2013 - $ 51,731

F2015 = A2014 + (1- )F2014 = 0.7*45,000 + (1-0.7)*48,000 = 45,900

F2016 = A2015 + (1- )F2015 = 0.7*50,000 + (1-0.7)*45,900 = 48,770

F2017 = A2016 + (1- )F2016 = 0.7*53,000 + (1-0.7)*48,770 = 51,731