With reference to exponential forecasting models, a parameter that provides the weight given to the most recent time series value in the calculation of the forecast value is known as the
A)moving average.
B)regression coefficient.
C)smoothing constant.
D)mean forecast error.

Question

Quizplus · Accepted Answer

The parameter that provides the weight given to the most recent time series value in the calculation of the forecast value is known as the smoothing constant. This parameter is also known as the level smoothing constant, and it determines how much weight the forecast places on the most recent observation. The value of the smoothing constant typically ranges between 0 and 1, indicating the degree to which the forecast should respond to changes in the time series. A smoothing constant of 1 would place all the weight on the most recent observation, while a smoothing constant of 0 would produce a forecast equal to the historical average. Therefore, the correct answer is C.

With Reference to Exponential Forecasting Models, a Parameter That Provides