The Morgan Company is interested in developing a forecast for next month's sales.It has collected sales data for the past 12 months. After analyzing these data,if the company wishes to use exponential smoothing with alpha = 0.20 and beta = 0.20,the starting values for the constant process and the trend process can be derived from a linear trend regression model by using the intercept and slope coefficient respectively.

Question

The Morgan Company is interested in developing a forecast for next month's sales.It has collected sales data for the past 12 months.  After analyzing these data,if the company wishes to use exponential smoothing with alpha = 0.20 and beta = 0.20,the starting values for the constant process and the trend process can be derived from a linear trend regression model by using the intercept and slope coefficient respectively.

Quizplus · Accepted Answer

Yes, the starting values for exponential smoothing with alpha and beta can be derived from a linear trend regression model by using the intercept and slope coefficient, respectively. This is because the linear trend regression model provides estimates for the level and trend components of the time series, which are the starting values for the constant process and trend process in exponential smoothing.

The Morgan Company Is Interested in Developing a Forecast for Next