Question

Using the data in the table, use the exponential smoothing method with alpha=0.5 and a February forecast of 500 to forecast

Answer 1

Answer:

Step-by-step explanation:

The formula to calculate the forecast could be determine by using the exponential smoothing method :

$Ft = F(t-1) + \alpha [A(t-1) - F(t-1)]$

Where ,Ft is the Forecast for period t

F(t-1) is the Forecast for the period previous to t

A(t-1) is the Actual demand for the period previous to t

$\alpha$ = Smoothing constant

To get the forecast for may and june   the above formula with $\alpha =0.5$ and april forecast of 500 will be used

For march

$=500+0.5(520-500)\\\\=500+0.5\times20\\\\=500+10\\\\=510$

For April

$=510+0.5(535-510)\\\\=510+0.5\times25\\\\=510+12.5\\\\=522.5$

For May

$=522.5+0.5(550-5225)\\\\=522.5+0.5\times27.5\\\\=522.5+13.75\\\\=536.25$

So forecast for May = 536.25