Given the values in the table below use exponential smoothin

Given the values in the table below, use exponential smoothing with trend (with both smoothing constants set to 0.2) to calculate the smoothed estimate and smoothed trend for periods 1 and 2, and calculate the forecast for periods 2 and 3. Make sure that you show your work.

Solution

The formula we use in this are

C_t=ay_t+(1-a)(C_t-1 + T_t-1)

T_t =b(C_t -C_t-1) +(1-b)T_t-1
F_t+1=C_t +T_t

Month	Demand	Smoothed Estimate	Smoothed Trend	Forecast
0		105	5
1	91	106.2	4.24	110
2	111	110.552	4.2624	110.44
3				114.8144