Sales of Volkswagen\'s popular Beetle have grown steadily at auto dealerships in

Question

Sales of Volkswagen's popular Beetle have grown steadily at auto dealerships in Nevada during the past 5 years (see table below). Using exponential smoothing with a smoothing constant (alpha) of 0.30 and a starting forecast of 415.00, the following sales forecast has been developed: The MAD for a forecast developed using exponential smoothing with alpha = 0.30 is 72.06 sales (round your response to two decimal places). Forecasted sales for years 2006 through 2010 using exponential smoothing with alpha = 0.60 and a starting forecast of 415.00 are (round your responses to two decimal places): The MAD for a forecast developed using exponential smoothing with alpha = 0.60 is sales (round your response to two decimal places).

Explanation / Answer

Exponential smoothing formula;

Forecast = Forecast + alpha ( forecasted sales - forecast)

For year = 2006

= 415 + 0.60 ( 415 - 415)

= 415

For year 2007

= 415 + 0.60 ( 439 - 415)

= 429.4

For year 2008

= 429.4 + 0.60 (481.60 - 429.4)

= 460.72

MAD = sum ( forecasted sales - forecast ) / n

= 216.798 / 6

= 36.13

Year Forecasted sales forecast Forecasted sales- forecast 2005 415 415 0 2006 439 415 24 2007 481.6 429.4 52.2 2008 502.24 460.72 41.52 2009 538.7 485.632 53.068 2010 563.48 517.47 46.01 216.798

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.