If a firm produced a standard item with relatively stable demand, the smoothing constant alpha (reaction rate to differences) used in an exponential smoothing forecasting model would tend to be in which of the following ranges?
A) 5 to 10 percent
B) 20 to 50 percent
C) 20 to 80 percent
D) 60 to 120 percent
E) 90 to 100 percent

Question

Quizplus · Accepted Answer

For a firm producing a standard item with relatively stable demand, a smaller smoothing constant is appropriate. Alpha values typically range from 0.05 to 0.1 in such cases.

If a Firm Produced a Standard Item with Relatively Stable