For which of the following values of the smoothing constant w will the smoothed series catch up most quickly whenever the original time series changes direction?
A)0.10.
B)0.50.
C)0.30.
D)0.70.

Question

Quizplus · Accepted Answer

The smoothed series will catch up most quickly to changes in the original time series direction when the smoothing constant (w) is higher. A higher value of w gives more weight to the most recent observations, making the series more responsive to changes. Therefore, 0.70 will result in the quickest adjustment.

For Which of the Following Values of the Smoothing Constant