A drive-in restaurant has experienced the following customer loads on the past 8 Friday nights.If their forecast for period 7 was 59 customers,then what is their forecast for period number 9 using a smoothing constant of 0.7?
A)61.10
B)62.43
C)59.90
D)60.83

Question

A drive-in restaurant has experienced the following customer loads on the past 8 Friday nights.If their forecast for period 7 was 59 customers,then what is their forecast for period number 9 using a smoothing constant of 0.7? 
A)61.10 
B)62.43 
C)59.90 
D)60.83

Quizplus · Accepted Answer

Using exponential smoothing with a smoothing constant of 0.7, we can calculate the forecast for each period using the formula: 
Forecast (next period) = (Smoothing constant x Actual demand for current period) + ((1 - Smoothing constant) x Forecast for current period)

Using this formula, we can calculate the forecast for period 8: 
Forecast for period 8 = (0.7 x 61) + (0.3 x 59) = 60.8

Then, we can use this forecast for period 8 to calculate the forecast for period 9: 
Forecast for period 9 = (0.7 x 60.8) + (0.3 x 61) = 62.43

Therefore, the best choice is B, with a forecast of 62.43 customers for period 9.

A Drive-In Restaurant Has Experienced the Following Customer Loads on the Past