A check-processing center uses exponential smooth- ing to forecast the number of incoming checks each month. The number of checks received in June was 40 million, while the fore- cast was 42 million. A smoothing constant of .2 is used. a) What is the forecast for July? b) If the center received 45 million checks in July, what would be the forecast for August? c) Why might this be an inappropriate forecasting method for the situation

A check-processing center uses exponential smooth- ing to forecast the number of incoming checks each month. The number of checks received in June was 40 million, while the fore- cast was 42 million. A smoothing constant of .2 is used. a) What is the forecast for July? b) If the center received 45 million checks in July, what would be the forecast for August? c) Why might this be an inappropriate forecasting method for the situation

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter13: Regression And Forecasting Models

Section13.3: Simple Regression Models

Problem 2P: The file P13_02.xlsx contains five years of monthly data on sales (number of units sold) for a...

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The file P13_42.xlsx contains monthly data on consumer revolving credit (in millions of dollars) through credit unions. a. Use these data to forecast consumer revolving credit through credit unions for the next 12 months. Do it in two ways. First, fit an exponential trend to the series. Second, use Holts method with optimized smoothing constants. b. Which of these two methods appears to provide the best forecasts? Answer by comparing their MAPE values.
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The moving average forecasting method is typically bestfor products:a) Functional b) Innovativec) Mature d) New