An Example

Month Demand

1 650

2 700

3 810

4 800

5 900

6 700

Month Demand 3-month Moving 3-month Wt. Moving Average Exponential Smoothing
Average (weights: 0.2, 0.3, 0.5) (alpha = 0.1)

1 650

2 700 0.1*650+0.9*650 =
650

3 810 0.1*700+0.9*650 =
655
4 800 (650+700+810)/3 = 720 0.2*650+0.3*700+0.5*810 = 0.1*810+0.9*655 =
745 670.5

5 900 (700+810+800)/3 = 770 0.2*700+0.3*810+0.5*800 = 0.1*800+0.9*670.5 =

783 683.5

6 700 (810+800+900)/3 = 837 0.2*810+0.3*800+0.5*900 = 0.1*900+0.9*683.5 =

852 705.2

7 (800+900+700)/3 = 800 0.2*800+0.3*900+0.5*700 = 0.1*700+0.9*705.2 =

780 704.7