I had a question related to calculating weighted average, on data example below given definition :
- Column C = Product Supply
- Column D = Product Demand
- Column E = Supply / Demand
- Column F = Demand Contribution (demand / total demand) to calculate total weight
- Column G = SD Ratio * Demand Contribution (E*F)
S/D ratio >1 means that we had too much supply and <1 means that we need to provide more supply. In case below im trying to aggregate the number to get better sense on warehouse A whether we are on overall over / under supply, using weighted average based on demand (we want prioritize warehouse with higher demand and product with higher demand) but i dont understand the approach is correct or not since when im summing the weighted ratio the total is tally to total supply/ total demand (column C13 = Column G12) is this the correct way to do the aggregation?