Which one of the following statements about forecasting is False?
A) You should use the simple moving-average method to estimate the mean demand of a time series that has a pronounced trend and seasonal influences.
B) The weighted moving-average method allows forecasters to emphasize recent demand over earlier demand. The forecast will be more responsive to change in the underlying average of the demand series.
C) The most frequently used time-series forecasting method is exponential smoothing because of its simplicity and the small amount of data needed to support it.
D) In exponential smoothing, higher values of alpha place greater weight on recent demands in computing the average.

Question

Quizplus · Accepted Answer

The statement about using simple moving-average method for a time series with trend and seasonality is false because such time series require more sophisticated forecasting methods such as exponential smoothing or seasonal decomposition.

Which One of the Following Statements About Forecasting Is False