The following table shows the actual demand observed over the last 11 years: Yea
ID: 399561 • Letter: T
Question
The following table shows the actual demand observed over the last 11 years:
Year
1
2
3
4
5
6
7
8
9
10
11
Demand
6
9
6
9
13
9
13
14
9
11
6
Using exponential smoothing with
alpha
=
0.50
and a forecast for year 1 of
5.0,
provide the forecast from periods 2 through 12 (round your responses to one decimal place).
Year
1
2
3
4
5
6
7
8
9
10
11
12
Forecast
5.0
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
Provide the forecast from periods 2 through 12 using the naive approach (enter your responses as whole numbers).
Year
2
3
4
5
6
7
8
9
10
11
12
Forecast
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
nothing
Year
1
2
3
4
5
6
7
8
9
10
11
Demand
6
9
6
9
13
9
13
14
9
11
6
Explanation / Answer
Following may be noted:
The formula is :
Ft = alpha xA t-1 + ( 1 – alpha) x Ft-1
= 0.5 x At-1 + 0.5 x Ft-1
Ft, Ft-1 = Forecasts for period t and t-1 respectively
At-1 = Actual demand for period t-1
Alpha = Exponential smoothing constant
Ft = At-1
Ft = Forecast for period t
At-1 = Demand for period t-1
Accordingly the please see below the filled up table with forecasted values for period upto 12 as per both methods :
Year
Demand
Forecast ( Exponential smoothing)
Forecast ( Naïve)
1
6
5.0
2
9
5.5
6
3
6
7.3
9
4
9
6.6
6
5
13
7.8
9
6
9
10.4
13
7
13
9.7
9
8
14
11.4
13
9
9
12.7
14
10
11
10.8
9
11
6
10.9
11
12
8.5
6
Year
Demand
Forecast ( Exponential smoothing)
Forecast ( Naïve)
1
6
5.0
2
9
5.5
6
3
6
7.3
9
4
9
6.6
6
5
13
7.8
9
6
9
10.4
13
7
13
9.7
9
8
14
11.4
13
9
9
12.7
14
10
11
10.8
9
11
6
10.9
11
12
8.5
6
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