What is basic naive method, Operation Management

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1. The monthly sales for Telco Batteries, Inc., were as follows: Month Sales

Jan 20

Feb 21

Mar 15

Apr 14

May 13

Jun 16

Jul 17

Aug 18

Sep 20

Oct 20

Nov 21

Dec 23

a. Plot the monthly sales data on a sheet of graph paper.

b. Forecast January sales for the new year using each of the following:

1) Basic naïve method.

2) A 3-month moving average.

3) A 6-month weighted moving average using 0.1, 0.1, 0.1, 0.2, 0.2, 0.3, with the heaviest weights applied to the most recent months.

4) Exponential smoothing using a smoothing constant of 0.3 and a September forecast of 18 (note that you must compute forecasts for Oct, Nov, and Dec before computing the one for January).

5) A trend projection using the least squares method c. With the data given,which method would allow you to forecast next March's sales?


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