High School

The owner of the Chocolate Outlet store wants to forecast chocolate demand. Demand for the preceding four years was:

1. 68,800
2. 71,000
3. 75,500
4. 71,200

Using 0.4 for Year 4, 0.2 for Year 3, and 0.4 for Year 2, what is the three-year weighted moving average for the Chocolate Outlet company in Year 5?

a. 72,400
b. 71,200
c. 71,500
d. 71,980

Answer :

Final answer:

The three-year weighted moving average for Year 5 is 71,980, calculated using the given demand values and weights.

So the correct option is d. 71,980

Explanation:

The three-year weighted moving average for Year 5 is calculated by multiplying the demand values of the last three years by their respective weights and then summing them up.

Weighted moving average = (71,200 x 0.4) + (75,500 x 0.2) + (71,000 x 0.4) = 28,480 + 15,100 + 28,400 = 71,980.

Therefore, the answer is d. 71,980.

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