What is the forecast for June using Holt's model with an alpha of 0.1 and a beta of 0.2?
A)69,612
B)69,121
C)70,082
D)70,499

Question

Quizplus · Accepted Answer

Holt's model with an alpha of 0.1 and a beta of 0.2 is given by:Ft+1 = α(At) + (1-α)(Ft) + β(Tt-Ft)where:Ft+1 is the forecast for period t+1At is the actual value for period tFt is the forecast for period tTt is the trend for period tPlugging in the given values, we get:Ft+1 = 0.1(69,500) + (1-0.1)(69,200) + 0.2(69,500-69,200)Ft+1 = 6,950 + 62,280 + 600Ft+1 = 69,612

What Is the Forecast for June Using Holt's Model with an Alpha