Given an actual demand of 59, a previous forecast of 64, and an alpha of 0.3, what would the forecast for the next period be using simple exponential smoothing?
A)36.9
B)57.5
C)60.5
D)62.5
E)65.5

Question

Quizplus · Accepted Answer

The formula for simple exponential smoothing is: Forecast = Previous Forecast + α(Actual Demand - Previous Forecast). Plugging in the values: 64 + 0.3(59 - 64) = 64 - 1.5 = 62.5.

Given an Actual Demand of 59, a Previous Forecast of 64