Question

John is trying to initialize the trend estimates for an exponential smoothing model with trends using the following demand data. He set the initialized trend estimate at the end of period 5 to __________. Complete the sentence correctly. Period 1 2 3 4 5 Demands 56 59 53 60 63

Answer 1

59.357

Explanation:

Ft= αAt-1+ (1-α)Ft-1

Let's take F1=56

F2=0.9(56)+(1-0.9)(56)

F2=56

F3=0.9(59)+(1-0.9)(56)

= 58.7

F4=0.9(53) + (1-0.9)(58.7)

F4=53.57

F5= 0.9(60) + (1-0.9)(53.57)

F5=59.357