Historical demand for a product is as follows:

DEMAND April 75 May 60 June 90 July 75 August 95 September 88

a. Using a simple four-month moving average, calculate a forecast for October.

b. Using single exponential smoothing with a = 0.10 and a September forecast = 80, calculate a forecast for October.

c. Using simple linear regression, calculate the trend line for the historical data. Say the X axis is April = 1, May = 2, and so on, while the Y axis is demand.

Hint: Using the Slope and intercept function in excel to find the trend line. See the excel example on p475. Y= ?+ ? t d. Calculate a forecast for October using your regression formula.
Demand Forecasting

Demand forecasting includes qualitative and quantitative techniques. Qualitative techniques are mostly used if past data is not available, whereas quantitative ones can be applied if the company has collected data on past demand.