# Materials Mgmt- Zeek the Geek

MGMT 4317 Chapter 8 Homework Problems – You must show all work in all problems to receive credit. You will receive zero (0) credit for providing the answer only.

1. Demand over past 3 months has been 250, 210, and 224 units. Using a three-month moving average, determine the forecast for month four. If the actual demand in month 4 is 264, calculate the forecast for month 5.

2. Given the following data, calculate the three-month moving average forecasts for months 4, 5, 6, and 7.

Month

Actual Demand

Forecast

1

65

2

80

3

50

4

45

5

60

6

70

7

3. If the forecast for May was 222, and the actual demand for May is 235, what would be the forecast for June if the smoothing constant (alpha) is .20? If June demand is actually 290, calculate forecast for July.

4. Given the following average demand, calculate the seasonal indices for each quarter:

Quarter

Average Demand

Seasonal Index

1

164

2

480

3

490

4

170

Total

Note that your answer, if calculated correctly, should have all of the seasonal indices add up to the number of quarters in the entire season.

5. Using the data in problem 4, and the seasonal indices you have calculated, calculate expected quarterly demand if the annual forecast is 2000 units.

Quarter

Seasonal Index

Forecast

1

2

3

4

6. Calculate the deseasonalized demands for the following:

Quarter

Annual Demand

Seasonal Index

Deseasonalized Demand

1

130

0.70

2

170

1.00

3

375

1.80

4

90

0.50

Total

7. For the following data, calculate the mean absolute deviation (MAD).

Period

Forecast

Actual Demand

Absolute Deviation

1

100

80

2

100

110

3

100

130

4

100

75

5

100

105

Total

8. A company uses a tracking signal trigger of + or – 4 to decide whether a forecast should be reviewed. Given the following history, determine in which period the forecast should be reviewed. Mean Absolute Deviation (MAD) for the item is 15. Is there any previous indication that the forecast should be reviewed?

Period

Forecast

Actual

Deviation

Cumulative Deviation

Tracking Signal

1

100

110

2

105

90

3

110

85

4

115

110

5

120

105

6

125

95