t mheducat recasting Help Save Saved A dry cleaner uses exponential smoothing to

Question

t mheducat recasting Help Save Saved A dry cleaner uses exponential smoothing to forecast equipment usage at its main plant August usage was forecasted to be 70 percent of capacity, actual usage was 71 percent of capacity. A smoothing constant of 0.1 is used a. Prepare a forecast for September. (Round your final answer to 2 decimal places.) orecast for tember l percent of capacity b. Assuming actual September usage of 72 percent, prepare a forecast for October usage. (Round your answer to 2 decimal places.) Forecast for October percent of capacity K Prev 2 of 5l Next >

Explanation / Answer

a. Forecast for September = 70.10% b. Forecast for October = 70.29% Explaination: a. August usage forecast of capacity (F) = 70% Actual usage (A) = 71% Smoothing constant (s) = 0.1 Computation of Forecast for September. Let it be F1. F1 = F + s (A - F) = 70% + 0.1 (71% - 70%) = 70.10% b. September usage forecast of capacity (F) = 70.10% Actual usage (A) = 72% Smoothing constant (s) = 0.1 Computation of Forecast for October. Let it be F1. F1 = F + s (A - F) = 70.10% + 0.1 (72% - 70.10%) = 70.29%

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