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Homework Solution Weighted Averages - Exponential Smoothing - Trend Cool-Man Air Conditioners Manual ManualComputer-Based TM MGMT E-5070 Part A.

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Presentation on theme: "Homework Solution Weighted Averages - Exponential Smoothing - Trend Cool-Man Air Conditioners Manual ManualComputer-Based TM MGMT E-5070 Part A."— Presentation transcript:

1 Homework Solution Weighted Averages - Exponential Smoothing - Trend Cool-Man Air Conditioners Manual ManualComputer-Based TM MGMT E-5070 Part A

2 Cool-Man Air Conditioners YearSales 1 st nd rd th th th ? Sales of Cool-Man air conditioners have grown steadily over the past five years:

3 Cool-Man Air Conditioners REQUIREMENT: 1.The sales manager had predicted, before the business started, that year 1s sales would be 410 units. Using exponential smoothing with a weight of α = 0.30, develop forecasts for years 2 through 6.

4 Cool-Man Air Conditioner Smoothing Exponential Smoothing 2 nd Year 1 st Year 1 st Year 1 st Year Forecast = Forecast + α ( Actual - Forecast ) = 410 units ( 450 units units ) = 410 units ( 40 units ) = 410 units + 12 units = 422 units

5 Cool-Man Air Conditioner Smoothing Exponential Smoothing 3 rd Year 2 nd Year 2 nd Year 2 nd Year Forecast = Forecast + α ( Actual - Forecast ) = 422 units ( 495 units units ) = 422 units ( 73 ) = 422 units units = units

6 Cool-Man Air Conditioner Smoothing Exponential Smoothing 4 th Year 3 rd Year 3 rd Year 3 rd Year Forecast = Forecast + α ( Actual - Forecast ) = units ( 518 units units ) = units ( 74.1 ) = units units = units

7 Cool-Man Air Conditioner Smoothing Exponential Smoothing 5 th Year 4 th Year 4 th Year 4 th Year Forecast = Forecast + α ( Actual - Forecast ) = units ( 563 units units ) = units ( ) = units units = units

8 Cool-Man Air Conditioner Smoothing Exponential Smoothing 6 th Year 5 th Year 5 th Year 5 th Year Forecast = Forecast + α ( Actual - Forecast ) = units ( 584 units units ) = units ( 88.8 ) = units units = units

9 Cool-Man Air Conditioners REQUIREMENT: 1.Using the smoothing coefficients of 0.60 and 0.90, develop forecasts for the sales of Cool- Man air conditioners.

10 Cool-Man Air Conditioners YearSalesForecast 1 st nd rd th th th ?565.6 Smoothing coefficient ( α ) = 0.60

11 Cool-Man Air Conditioners YearSalesForecast 1 st nd rd th th th ? Smoothing coefficient ( α ) = 0.90

12 Homework Solution Weighted Averages - Exponential Smoothing - Trend Cool-Man Air Conditioners Manual ManualComputer-Based TM Part A


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