Selecting a large value for the smoothing constant ( $\alpha$ )in exponential smoothing
A) results in more importance being placed on the exponentially smoothed value from the previous period.
B) results in more importance being placed on the actual y value for the current time period.
C) more strongly dampens the fluctuations in the original series.
D) results in a less accurate forecast.

Question

Quizplus · Accepted Answer

Selecting a large value for the smoothing constant ($\alpha$) in exponential smoothing places more importance on the most recent actual data point ($y$ value) for the current time period, making the forecast more responsive to recent changes in the data.

Selecting a Large Value for the Smoothing Constant α\alphaα )In Exponential Smoothing A) Results in More Importance Being Placed

Selecting a Large Value for the Smoothing Constant $\alpha$ )In Exponential Smoothing
A) Results in More Importance Being Placed