THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION

question 88

Multiple Choice

THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION:
The table below is the data set of the Shiller Real Home Price Index for the years 1894-1904.
Use a smoothing constant of α = 0.8 to determine the forecasts using simple exponential smoothing.

-Calculate the forecast value for the year 1905,if the real home price index for that year is 98.056.

• A)100.31
• B)98.51
• C)98.06
• D)cannot be determined

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Definitions:

Journalize

Refers to the process of recording business transactions in the journal as part of the accounting cycle.

Reporting Period

The span of time covered by the financial statements of a business.

General Journal

A primary accounting record used to document all business transactions in chronological order.

Indirect Materials

Components used in the manufacturing process that are not directly traceable to a specific product, like lubricants for machines.