(Requires StatTools) This data set has obvious seasonality and some upward trend, so one appropriate forecasting method is to use Holt's exponential smoothing method on the deseasonalized series. If this method is used with both smoothing constants equal to 0.2, which of the following is true?

Click here to reference the data needed to answer the question.

a is not the correct answer

a. To get a future forecast (i.e., beyond 2016), this method starts with the last estimated deseasonalized level, keeps adding the last estimated deseasonalized trend, and finally multiplies the sum by the relevant seasonal factor.

b. If the graph of the deseasonalized errors is requested, it will typically not show a seasonal pattern.

c. This method doesn't update the seasonal factors through time, i.e., the seasonal factors don't change from year to year.

d. All of these choices are true.

Month

Value

Jan-12

6401

Feb-12

6048

Mar-12

8787

Apr-12

9086

May-12

9854

Jun-12

14759

Jul-12

19492

Aug-12

21753

Sep-12

14664

Oct-12

7898

Nov-12

8245

Dec-12

10388

Jan-13

11341

Feb-13

6966

Mar-13

11527

Apr-13

9766

May-13

13552

Jun-13

18980

Jul-13

24301

Aug-13

24981

Sep-13

17702

Oct-13

11022

Nov-13

11141

Dec-13

11521

Jan-14

10973

Feb-14

9803

Mar-14

13353

Apr-14

15789

May-14

16501

Jun-14

21817

Jul-14

27932

Aug-14

31739

Sep-14

23213

Oct-14

13975

Nov-14

11820

Dec-14

12705

Jan-15

12029

Feb-15

11013

Mar-15

15448

Apr-15

17162

May-15

18466

Jun-15

26814

Jul-15

33774

Aug-15

38136

Sep-15

25280

Oct-15

16143

Nov-15

13338

Dec-15

14672

Jan-16

17716

Feb-16

12277

Mar-16

16839

Apr-16

19968

May-16

19178

Jun-16

31083

Jul-16

40551

Aug-16

44634

Sep-16

30080

Oct-16

17866

Nov-16

16025

Dec-16

18203