Question: With a smoothing constant of = 0 . 4 , the exponential smoothing forecast equation t + 1 = Yt + ( 1 ) t

With a smoothing constant of =0.4, the exponential smoothing forecast equation
t +1=Yt +(1)t
shows that the forecast for week 13 of the gasoline sales data from the table is given by
13=0.4Y12+0.612.
However, the forecast for week 12 is given by
12=0.4Y11+0.611.
Thus, we could combine these two results to show that the forecast for week 13 can be written
13=0.4Y12+0.6(0.4Y11+0.611)=0.4Y12+0.24Y11+0.3611.

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