1
Question
The forecast for the monthly demand of a product is given in the table below.
Month
Forecast
Actual sales
1
32.00
30.00
2
31.80
32.00
3
31.82
30.00
The forecast is made by using the exponential smoothing method. The exponential smoothing coefficient used in forecasting the demand is
The forecast for the monthly demand of a product is given in the table below.
| Month | Forecast | Actual sales |
| 1 | 32.00 | 30.00 |
| 2 | 31.80 | 32.00 |
| 3 | 31.82 | 30.00 |
The forecast is made by using the exponential smoothing method. The exponential smoothing coefficient used in forecasting the demand is
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Solution
The correct option is A 0.10
From given data in the table:
Ft=Ft−1+α(Dt−1−Ft−1)
For 2nd month Ft=31.8,
For 1st month
Ft−1=32 and Dt−1=30
31.8=32+α(30−32)
2α=32−31.8
α=0.1
From given data in the table:
Ft=Ft−1+α(Dt−1−Ft−1)
For 2nd month Ft=31.8,
For 1st month
Ft−1=32 and Dt−1=30
31.8=32+α(30−32)
2α=32−31.8
α=0.1
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