LP2 Assignment: Quantitative Forecasting
Clyde’s Chairs and Things sells custom made chairs. Yearly sales from 1983 to 2011 are provided below. After analyzing the information, answer the following questions as completely as possible:
- Plot the yearly sales data.
- Compute the sales forecast for 2012 using the following approaches:
a) naïve forecast
b) a four year moving average
c) a weighted 3 year average using .5 for 2011, .3 for 2010, and .2 for 2009
d) exponential smoothing with alpha (smoothing constant) equal to .4 and assuming a 1984 forecast value of 20,050 - Which method was the most appropriate and why? Which was the least appropriate and why?
| Year | Chair Sales (Qty.) |
| 1983 | 16,688 |
| 1984 | 21,184 |
| 1985 | 25,594 |
| 1986 | 28,110 |
| 1987 | 25,311 |
| 1988 | 20,112 |
| 1989 | 14,521 |
| 1990 | 10,749 |
| 1991 | 11,343 |
| 1992 | 15,162 |
| 1993 | 15,820 |
| 1994 | 16,533 |
| 1995 | 14,449 |
| 1996 | 15,077 |
| 1997 | 15,152 |
| 1998 | 16,303 |
| 1999 | 15,457 |
| 2000 | 14,199 |
| 2001 | 13,030 |
| 2002 | 13,636 |
| 2003 | 13,037 |
| 2004 | 14,842 |
| 2005 | 14,585 |
| 2006 | 10,916 |
| 2007 | 6,928 |
| 2008 | 5,368 |
| 2009 | 5,074 |
| 2010 | 5,839 |
| 2011 | 4,889 |
Type your responses in a Word document and submit it to your instructor via the dropbox “LP2 Assignment: Quantitative Forecasting.” This assignment is worth 65 points; grading will be based on the LP2 Scoring Guide.
