Use Exponential smoothing forecasts with alpha of 0.1, 0.2, ..., 0.9 to predict October 2023 demand.  Identify the value of alpha that results in the lowest MAD.

 

What is the forecast, and seasonal indices for October, November and December 2023?

							Alpha =	0.10
							MAD =	10.07
Month	Year	Period	Price	AIP	Diff	Adv	Demand	Exp. Forecast	Abs. Dev.
January	2021	1	7.85	7.81	-0.04	9.52	29.75	29.75	0
February	2021	2	7.69	7.99	0.30	9.10	29.48	29.75	0.27
March	2021	3	7.70	7.94	0.24	8.37	28.04	29.777	1.737
April	2021	4	7.68	7.86	0.18	8.73	27.16	29.9507	2.7907
May	2021	5	8.65	7.99	-0.66	8.37	23.40	30.22977	6.82977
June	2021	6	8.54	7.73	-0.81	7.38	21.67	30.912747	9.242747
July	2021	7	8.48	8.22	-0.26	6.94	20.84	31.8370217	10.9970217
August	2021	8	8.61	8.36	-0.25	8.37	23.11	32.93672387	9.82672387
September	2021	9	8.09	8.23	0.14	8.23	26.00	33.91939626	7.919396257
October	2021	10	7.85	8.33	0.48	9.10	27.44	34.71133588	7.271335883
November	2021	11	7.88	8.48	0.60	8.95	30.33	35.43846947	5.108469471
December	2021	12	7.90	8.36	0.46	8.81	34.09	35.94931642	1.859316418
January	2022	13	7.97	8.23	0.26	8.81	33.51	36.13524806	2.62524806
February	2022	14	7.82	8.43	0.61	9.20	32.62	36.39777287	3.777772866
March	2022	15	7.95	8.57	0.62	9.10	31.78	36.77555015	4.995550152
April	2022	16	7.84	8.33	0.49	8.81	30.94	37.27510517	6.335105168
May	2022	17	7.89	7.88	-0.01	8.37	29.53	37.90861568	8.378615684
June	2022	18	8.10	7.90	-0.20	8.66	27.16	38.74647725	11.58647725
July	2022	19	7.88	7.72	-0.16	9.80	26.85	39.90512498	13.05512498
August	2022	20	7.82	8.10	0.28	9.52	29.18	41.21063748	12.03063748
September	2022	21	7.61	7.74	0.13	9.80	30.04	42.41370122	12.37370122
October	2022	22	7.84	8.87	1.03	10.66	33.78	43.65107135	9.871071346
November	2022	23	7.74	8.51	0.77	10.95	36.40	44.63817848	8.238178481
December	2022	24	7.84	7.73	-0.11	11.52	41.03	45.46199633	4.431996329
January	2023	25	7.88	7.90	0.02	11.67	38.42	45.90519596	7.485195962
February	2023	26	7.98	7.99	0.01	12.09	36.11	46.65371556	10.54371556
March	2023	27	7.38	8.52	1.14	12.67	35.32	47.70808711	12.38808711
April	2023	28	7.44	8.60	1.16	12.95	33.86	48.94689582	15.08689582
May	2023	29	7.82	8.75	0.93	13.24	32.93	50.45558541	17.52558541
June	2023	30	8.10	8.86	0.76	13.81	32.37	52.20814395	19.83814395
July	2023	31	8.35	7.90	-0.45	6.69	24.85	54.19195834	29.34195834
August	2023	32	7.88	8.19	0.31	7.23	27.44	57.12615418	29.68615418
September	2023	33	8.18	8.61	0.43	8.81	31.20	60.09476959	28.89476959
October	2023	34	7.83	7.95	0.12	10.99		62.98424655
November	2023	35	7.72	8.19	0.47	12.31		69.28267121
December	2023	36	8.03	8.39	0.36	10.98		76.21093833

Answer rating: 100% (QA)

Solution To forecast the demand for October 2023 we can use exponential smoothing with alpha values ... View the full answer