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(Solved): Given the following demand data, compute a simple exponential smoothing forecast for alpha values o ...
Given the following demand data, compute a simple exponential smoothing forecast for alpha values of \( 0.3 \) and \( 0.5 \). Use the actual value in Period 1 as your starting forecast in Period 2, (Round all your calculations to two decimal points.)
Expert Answer
Answer: Exponential Smoothing Formula: Ft+1 = x At + (1 - ) x Ft Here: At = Previous Actual Value Ft = Previous Forecast Value = Alpha Given that: Initial At = 55 Initial Ft = 55 Therefore: For Alpha = 0.3 Period 2 Forecast = 0.3 x 55 + (1 - 0.3) x 5