State problem or decision issue explored inpr

Solution
Data for the growth of global demand over last ten years is as:
Year
Sales
(000’s)
1 4.2
2 5
3 5.4
4 5.8
5 6.5
6 6.6
7 6.3
8 6.5
9 7
10 7.3
As sales manager has indicated that there were 4000 units’ backorder in year 1 we can update
this detail in the data. So 4,200 will be forecast for the year 1 and actual data will be 8,200. Our
data will be as:
Year
Sales
(000’s)
1 8.2
2 5
3 5.4
4 5.8
5 6.5
6 6.6
7 6.3
8 6.5
9 7
10 7.3
Based on above data forecast for the next year using different methods will be as:
 Three year moving average
Forecast made on based of three year moving average can be calculate by taking average
of first three year and rolling over to the next years. In this case we first calculate the
average for the fourth year by taking average of year 1,2 and 3.








Where n is forecast for the year 4.
We continue this process and calculate forecast for year 5 by taking into consideration
year 2, 3 and 4 and so on.
Based on above methodology forecast for the year 4 and so on is as:
Year
Sales
(000’s)
Moving
Average
1 8.2
2 5
3 5.4
4 5.8 6.2...