Monthly demand for a product has been as follows in the last 2 months. July 60 unitsAugust 56 unitsWhat is the forecast for September using exponential smoothing with alpha = 0.4 if the forecast for July was 70 units?

The forecast for September using exponential smoothing with alpha = 0.4 is  62.

Explanation:

Forecasting Formula

Forecasting the next point is determined using the forecasting formula is the basic equation

S(t+1)=αy(t)+(1−α)S(t), 0<α≤1,t>0.

α = alpha =0.4

New forecast S(t+1) is previous forecast S(t) plus an error adjustment. This can be written as:

S(t+1)=S(t)+αϵ(t),

where ϵ(t) is the forecast error (actual - forecast) for period t.

In other words, the new forecast is the old one plus an adjustment for the error that occurred in the last forecast.

New forecast for August  S(t+1) = 0.4×60 + (1-0.4)×70

                                                   = 66

New forecast for September S(t+1) =0.4×56 + (1-0.4)×66

                                                          =62

answer; work samples;

two years ago, when picking flowers in the mountains back of yosemite valley, i found a book. it was blotted and storm-beaten; all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however; many of the inner pages were well preserved. and although all were more or less stained and torn, whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today; its granite pages have been torn and blurred by the same storms that wasted the castaway book.

two years ago, when picking flowers in the mountains back of yosemite valley; i found a book. it was blotted and storm-beaten, all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however, many of the inner pages were well preserved. and although all were more or less stained and torn; whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today, its granite pages have been torn and blurred by the same storms that wasted the castaway book.