Table 8.8 The Manager of a Pizza Shop Must Forecast Weekly Demand

question 21

Multiple Choice

Table 8.8
The manager of a pizza shop must forecast weekly demand for special pizzas so that he can order pizza shells weekly. Recent demand has been:

-Use the information from Table 8.8. The pizza shop manager believes that a combination forecast might improve her ability to predict future demand, and thus improve keeping fresh ingredients on hand. She decides to use the 3-week simple moving average and 3-week weighted moving average, giving them equal weight. The 3-week weighted moving averages are .6 for the most recent period, .25 for the second most recent period, and .15 for the third most recent period. What is her forecast for week #7?

• A) 38.15 pizzas
• B) 39.5 pizzas
• C) 37 pizzas
• D) 37.58 pizzas

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Definitions:

Acid-Test Ratio

A stringent indicator of a company's short-term liquidity, calculated by dividing current assets excluding inventory by current liabilities.

Working Capital

The difference between a company's current assets and its current liabilities, indicating the liquidity of the business.

Financial Data

Quantitative information about financial conditions, performance, and transactions of a business, individual, or entity.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations with its current assets.