Question

Economics

Problem 1: Auto sales at Carmen’s Chevrolet are shown below. Develop a 3-week moving average.

Week	Auto Sales
1	8
2	10
3	9
4	11
5	10
6	13
7	-

Problem 2:

Carmen’s decides to forecast auto sales by weighting the three weeks as follows:

Weights Applied	Period
3	Last week
2	Twoweeks ago
1	Three weeks ago
6	Total

Solve step by step and mentioning formula too , *please note that don't solves directly, solve the it by putting values in formula so i know how it is solved.

Again i am beginner and i don't know how formula works etc.  

*Don't copy paste other answers as they are not clear and they are directly given answers.

Answer 1

To calculate the 3 week moving average for week n we need to sum value of Week n, week n-1 and week n-2 and divide by 3

Hence we will start calculating from week 3

3 Week moving average of week 3 = (Sales of week 1+sales of week 2+sales of week 3)/3 = (8+10+9 )/3= 27/3= 9

3 Week moving average of week 4 = (Sales of week 2+sales of week 3+sales of week 4)/3 = (10+9+11 )/3= 30/3= 10

3 Week moving average of week 5 = (Sales of week 3+sales of week 4+sales of week 5)/3 = (9+11 +10)/3= 30/3= 10

3 Week moving average of week 6 = (Sales of week 4+sales of week 5+sales of week 6)/3 = (11 +10+13)/3= 34/3= 11.33

For forecasting of week n = (Weight of Week n-1 * Value of week n-1 +Weight of Week n-2 * Value of week n-2+Weight of Week n-3 * Value of week n-3)/(sum of weights)

Hence forecast for week 4 = (3* value of week 3+2* value for week 2+1*value of week 1)/6

= (3*9+2*10+1*8)/6

= (27+20+8)/6

=55/6

= 9.16

Hence forecast for week 5 = (3* value of week 4+2* value for week 3+1*value of week 2)/6

= (3*11+2*9+1*10)/6

= (33+18+10)/6

=61/6

= 10.17

Hence forecast for week 6 = (3* value of week 5+2* value for week 4+1*value of week 3)/6

= (3*10+2*11+1*9)/6

= (30+22+9)/6

=61/6

= 10.17

Hence forecast for week 7 = (3* value of week 6+2* value for week 5+1*value of week 4)/6

= (3*13+2*10+1*11)/6

= (39+20+11)/6

=70/6

= 11.67

Result can be tabulated below

Week	Auto Sales	3 day Moving Average	Forecast
1	8
2	10
3	9	9
4	11	10	9.16
5	10	10	10.17
6	13	11.33	10.17
7			11.67