Answer :
Answer:
175.36
Explanation:
Given that,
Demand data for various month is given.
Forecast for July = 164
Alpha = 0.8
Calculation of forecast by using the exponential smoothing method:
F(t+1) = ∝Y(t) + (1 - ∝)F(t)
F(t+1) represents forecast value of (t+1)
∝ = Smoothing constant
Y(t) = Actual value of period t
F(t) = Forecast of period t
For the month of July,
F(t+1) = ∝Y(t) + (1 - ∝)F(t)
= (0.8 × 165) + [(1 - 0.8) × 164]
= 132 + 32.8
= 164.8
For the month of August,
F(t+1) = ∝Y(t) + (1 - ∝)F(t)
= (0.8 × 178) + [(1 - 0.8) × 164.8]
= 142.4 + 32.96
= 175.36
Therefore, the forecast for August is 175.36 if the forecast for June was 164.