Question: Selecting smoothing constant is a key decision when applying exponential smoothing method. When you have previous data, one approach to making this decision is to
Selecting smoothing constant is a key decision when applying exponential smoothing method. When you have previous data, one approach to making this decision is to apply the method retrospectively to these data with different values of smoothing constant and then choose the value of smoothing constant that gives the smallest MAD. Use this approach for choosing smoothing constant with each of the following data, which represent monthly sales. In each case, use an initial estimate of and compare with the following smoothing constants of and
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