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What is the forecast for week 2 using exponential smoothing with α = 0.25?

User Nickelman
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1 Answer

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Final answer:

While the student inquires about forecast using exponential smoothing with a smoothing factor, the necessary initial data to perform the calculation is not provided in the question.

Step-by-step explanation:

The student's question is about using exponential smoothing for forecasting, with a specific smoothing factor (α = 0.25). However, the given information does not provide the initial data needed to apply exponential smoothing, such as a prior period's actual sales or an initial forecast.

Exponential smoothing is a method used to make short-term predictions by taking the weighted average of past observations, with the weights declining exponentially as the observations get older. The formula for exponential smoothing is given by
F_t = α * A_{t-1} + (1 - α) * F_{t-1}, where F_t is the forecast for period t, A_{t-1} is the actual value at time t-1, and α is the smoothing constant between 0 and 1.

User Billy Adelphia
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