The forecasting technique known for its ability to emphasize recent data and systematically discount old information is known as:
A) trend projection.
B) moving average.
C) exponential smoothing.
D) naïve approach.
E) linear regression analysis.

Question

Quizplus · Accepted Answer

The technique described in the question is known as exponential smoothing. It places greater weight on recent data, and as the name suggests, the weightage assigned to past data exponentially decreases as it gets older. This technique is useful when there is a trend or seasonality in the data. The other forecasting techniques - trend projection, moving average, naïve approach, and linear regression do not place a higher emphasis on recent data in the same way as exponential smoothing.

The Forecasting Technique Known for Its Ability to Emphasize Recent