An exponential smoothing technique in which the smoothing constant alpha is equal to one is equivalent to a naïve forecasting model.

Question

Quizplus · Accepted Answer

When the smoothing constant alpha is equal to one, the forecast for the next period is simply the actual value from the current period. This is the definition of a naive forecast model, which assumes that the most recent observation is the best predictor of the future.

An Exponential Smoothing Technique in Which the Smoothing Constant Alpha