CPIM Practice Exam

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What is the three-month moving average forecast for the upcoming month given the prior six months’ demand of 56, 58, 55, 50, 48, and 45 units?

48 units
52 units
54 units
104 units

The correct answer is: 48 units

To calculate the three-month moving average forecast, you need to analyze the demand over the last three months of the six-month period provided. The prior six months’ demand values are 56, 58, 55, 50, 48, and 45 units, which are arranged chronologically. The demand for the last three months is noted as follows: - Month 4: 50 units - Month 5: 48 units - Month 6: 45 units To compute the three-month moving average, sum these three months' demands and divide by the number of months (which, in this case, is three): \[ \text{Three-Month Moving Average} = \frac{(50 + 48 + 45)}{3} \] Calculating this gives: \[ \text{Three-Month Moving Average} = \frac{143}{3} \approx 47.67 \] When rounded to the nearest whole number, this forecast results in 48 units. This is the correct approach and calculation process for determining a three-month moving average, making the answer of 48 units valid. It represents a typical forecasting method used to smooth out fluctuations or variations in