Month Year Demand (lbs) Naïve Model Forecast Error Cumulative

Jan 2012 584

Feb 2012 552 584 -32 584
Mar 2012 544 522 22 568
Apr 2012 576 544 32 560
May 2012 585 576 9 564
Jun 2012 784 585 199 568
Jul 2012 1026 784 242 604
Aug 2012 1098 1026 72 664
Sep 2012 666 1098 -432 719
Oct 2012 504 666 -162 713
Nov 2012 576 504 72 692
Dec 2012 1224 576 648 681
Jan 2013 720 1224 -504 727
Feb 2013 729 720 9 726
Mar 2013 747 729 18 726
Apr 2013 621 747 -126 728
May 2013 819 621 198 721
Jun 2013 1260 819 441 727
Jul 2013 1368 1260 108 756
Aug 2013 1530 1368 162 789
Sep 2013 873 1530 -657 826
Oct 2013 976 873 103 828
Nov 2013 624 976 -352 835
Dec 2013 1416 624 792 825
Jan 2014 855 1416 -561 850
Feb 2014 528 855 -327 850
Mar 2014 729 528 201 838
Apr 2014 800 729 71 834
May 2014 744 800 -56 833
Jun 2014 928 744 184 830
Jul 2014 1560 928 632 833
Aug 2014 1746 1560 186 856
Sep 2014 909 1746 -837 884
Oct 2014 1773 909 864 885
Nov 2014 2000 1773 227 911
Dec 2014 1512 2000 -488 942
Jan 2015 1512 958

Sum E^2 5154076 Sum E^2 6172259

N 35 N 35
RMSE for NAÏVE 383.7438134 RMSE for Cumulative 419.940778138
Error 12 Period Moving Avg Model Forecast Error

-32
-24
16
21
216
422
434
-53
-209
-116
543
-7 726.58 -6.583
3 737.92 -8.917
21 752.67 -5.667
-107 769.58 -148.583
98 773.33 45.667
533 792.83 467.167
612 832.50 535.500
741 861.00 669.000
47 897.00 -24.000
148 914.25 61.750
-211 953.58 -329.583
591 957.58 458.417
5 973.58 -118.583
-322 984.83 -456.833
-109 968.08 -239.083
-34 966.58 -166.583
-89 981.50 -237.500
98 975.25 -47.250
727 947.58 612.417
890 963.58 782.417
25 981.58 -72.583
888 984.58 788.417
1089 1051.00 949.000
570 1165.67 346.333
1173.67

Sum E^2
N
RMSE for Mov- Avg
4300998.764
24
423.3299916
Demand (lbs)

2500
Monthly Demand 2012-2014

2000

1500

1000

500

0
2012
2012
2012
2012
2012
2012
2012
2012
2012
2012
2012
2012
2013
2013
2013
2013
2013
2013
2013
2013
2013
2013
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct

Months (2012-2014)

Q1
(a) The correct option is A, as there appears to be a POSITIVE trend becau
(b) The correct option is C, as yes, there appears to be some sort of seaso
(c) The forecast for Demand in January 2015 using Naïve Model is 1512,
y Demand 2012-2014
2013
2013
2013
2013
2013
2013
2013
2013
2013
2014
2014
2014
2014
2014
2014
2014
2014
2014
2014
2014
2014

r Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

be a POSITIVE trend because the Demand for Palm oil is going upwards from 2012 to 2014
to be some sort of seasonality, as the chart above displays greater amounts of demand in the months of June, July, August
ng Naïve Model is 1512, using Cumulative Model is 958, and using 12 period moving average is 1203
nths of June, July, August, and November, December across 2012 -2014
Q2
(a) Demand Yearly 728
Cost of processing single order 90
Rate of carrying Inventory 20%
Value of one item 12.5

EOQ 229

(b) Avg Inventory 114

Mad Cow Cheddar will be on shelf for 8

(c) If for one sq ft have to pay $10, then for 0.15 sq ft have to pay 1.5
and for whole year have to pay 78
EOQ 40

(d) If one wheel of Mad Cow Cheddar occupies 0.15 sq ft then in 3 sq ft I can fit 20
weeks

per week

wheels