Table 14.10
TOMBOW is a small manufacturer of pencils and has had the following sales record for the most recent five months: Use an exponential smoothing model to forecast sales in months 2,3,4,and 5.Let the smoothing parameter equal 0.6;select F1 = 150 to get the forecast started.
-Use the information in Table 14.10.The forecast for month 3 is:

Question

Table 14.10
TOMBOW is a small manufacturer of pencils and has had the following sales record for the most recent five months:  Use an exponential smoothing model to forecast sales in months 2,3,4,and 5.Let the smoothing parameter equal 0.6;select F1 = 150 to get the forecast started.
-Use the information in Table 14.10.The forecast for month 3 is:

Quizplus · Accepted Answer

Using exponential smoothing with a smoothing parameter of 0.6 and F1 = 150 yields the following forecast for the next four months:

F2 = (0.6)(280) + (0.4)(150) = 222
F3 = (0.6)(330) + (0.4)(222) = 276.6 ≈ 277
F4 = (0.6)(380) + (0.4)(277) = 329.2 ≈ 329
F5 = (0.6)(410) + (0.4)(329) = 376.4 ≈ 376

Therefore, the forecast for month 3 is greater than 140 but fewer than or equal to 160 units.

Table 14.10 TOMBOW Is a Small Manufacturer of Pencils and Has Had