Using the data set below, what would be the forecast for period 5 using the expo
ID: 385542 • Letter: U
Question
Using the data set below, what would be the forecast for period 5 using the exponential smoothing method? Assume the forecast for period 4 is 14000. Use a smoothing constant of = 0.4 (Choose the closest answer.)
Period
Actual Demand
1
10000
2
12400
3
13250
4
14750
5
15220
6
18500
14300
15220
Using the actual demand shown in the table below, what is the forecast for May (accurate to 1 decimal) using a 3-month weighted moving average and the weights 0.20, 0.35, 0.45 (with the heaviest weight applied to the most recent period. Round to nearest whole number)?
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
39
36
40
38
48
58
68
The smoothing constant for exponential smoothing must be?
Period
Actual Demand
1
10000
2
12400
3
13250
4
14750
5
15220
6
18500
Explanation / Answer
Forecast for May using 3 month weighted moving average
= 0.45 x April data + 0.25 x March data + 0.20 x February data
= 0.45 x 58 + 0.25 x 48 + 0.20 x 38
= 26.1 + 12 + 7.6
= 45.70 ( 46 rounded to nearest whole number )
Note : The answer does not match with the given options. However to note that heaviest weight is 0.45 and most recent period is April
The smoothing constant is a positive number which does not exceed 1.
Therefore correct answer should be “ Between 0 and 1”
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