Question

Given an actual demand of 61, forecast of 58, and a of 3, what would the forecast for the next period be using simple exponential smoothing?

a. 57.1
b. 58.9
c. 65.5
d. 61.0

Answer 1

To use simple exponential smoothing to forecast the next period, we can use the formula: Forecast for next period = (Previous forecast + Smoothing factor * (Actual demand - Previous forecast)). Given the actual demand of 61, forecast of 58, and a smoothing factor of 3, the forecast for the next period would be 67.

Step-by-step explanation:

To use simple exponential smoothing to forecast the next period, we need to use the formula:

Forecast for next period = (Previous forecast + Smoothing factor * (Actual demand - Previous forecast))

Given the actual demand of 61, forecast of 58, and a smoothing factor of 3, we can substitute these values into the formula:

Forecast for next period = (58 + 3 * (61 - 58))

Forecast for next period = 58 + 3 * 3 = 58 + 9 = 67

Therefore, the forecast for the next period would be 67.