Question

Sales of Volkswagen's popular Beetle have grown steadily at auto dealerships in Nevada during the past 5 years. The sales manager has predicted in 2004 and 2005 sales would be 410 VW's. Using exponential smoothing with a alpha = 0.30 develop a forecast for 2006 through 2010. What is the forecast value for 2010?Please answer to one decimal place. (Example: 466.1)Formula: Ft = Ft-1 + alpha(At-1 - Ft-1)Actual sales data:2005 = 4502006 = 4952007 = 5182008 = 5632009 = 584

Answer 1

Answer:

Step-by-step explanation:

Given the data:

Year___Actual sale (At) ___forecast(Ft)

2005__450_____________410

2006__495____________ 422

2007__518____________ 443.9

2008_ 563____________ 466.1

2009_584____________ 495.2

2010__

Using the formula :

Ft = Ft-1 + alpha(At-1 - Ft-1)

Ft-1 = previous year forecast

At-1 = previous year actual

Alpha = 0.3

Forecast:

2006:

410 + 0.3(450 - 410) = 422.0

2007:

422 + 0.3(495 - 422) = 443.9

2008:

443.9 + 0.3(518 - 443.9) = 466.1

2009:

466.1 + 0.3(563 - 466.1) = 495.2

2010:

495.2 + 0.3(584 - 495.2) = 521.8

Forecasted value for 2010 = 521.8