THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION:
The table below is the data set of the number of preorders received for a particular game on a weekly basis.
The forecaster uses the Holt-Winters Exponential Smoothing for nonseasonal series to forecast the number of preorders in future time periods.
He uses α = 0.8 and β = 0.5.(Hint: Use the formula from the text to arrive at the answers. )

-The forecast for week 13 is approximately:
A)696 units.
B)767 units.
C)805 units.
D)966 units.

Question

THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION:
The table below is the data set of the number of preorders received for a particular game on a weekly basis.
The forecaster uses the Holt-Winters Exponential Smoothing for nonseasonal series to forecast the number of preorders in future time periods.
He uses α = 0.8 and β = 0.5.(Hint: Use the formula from the text to arrive at the answers. )
 
-The forecast for week 13 is approximately:
A)696 units. 
B)767 units. 
C)805 units. 
D)966 units.

Quizplus · Accepted Answer

Using Holt-Winters exponential smoothing, we can calculate the forecast for week 13 as follows:

Level for week 13 = α(actual for week 12) + (1-α)(Level for week 12)
                    = 0.8(734) + 0.2(699.09)
                    = 729.27

Trend for week 13 = β(level for week 13 - level for week 12) + (1-β)(trend for week 12)
                    = 0.5(729.27-734) + 0.5(62.21)
                    = -2.36

Forecast for week 13 = level for week 13 + trend for week 13
                        = 729.27 - 2.36
                        = 726.91
The closest answer to 726.91 is C)805 units.