Question

The demand for a two-wheeler was 900 units and 1030 units in April 2015 and May 2015, respectively. The forecast for the month of April 2015 was 850 units. Considering a smoothing constant of 0.6, the forecast for the month of June 2015 is

• A. 927 units
• B. 850 units
• C. 965 units
• D. 970 units

Answer 1

The correct option is D 970 units

Month	Demand	Forecast
April	900	850
May	1030
June		??

$\text{Given data:}$

$\alpha =0.6,$

Forecast for may, 2015

$=850+0.6(900-850)=880$

Forecast for June, 2015

$=880+0.6(1030-880)$

$=880+90=970\text{units}$