How can you make a forecast more responsive when using 1 a s

How can you make a forecast more responsive when using: 1) a simple moving average, 2) a weighted moving average, or 3) exponential smoothing? Answer for each method separately.

Solution

A.simple moving averages represents mean and random walk model.it represents 2 extremes as far as forecasting is concerned.According to mean method it assume the best predictor of what will happen in future as well as random walk method assume that the best predictor of what will happen in future and what was happened in past can be ignored.

B.weighted moving average model represents the past data in a decreasing manner.It gives more weighage to recent data.

C.Exponential smoothing represents the information which involves last forecast withthe help of recent data.