A Company Has Had Actual Unit Demand for Four Consecutive

question 3

Short Answer

A company has had actual unit demand for four consecutive years of 100, 110, 125, and 150.The respective forecasts using exponential smoothing were 120 for each of those four years.What value of alpha, the smoothing constant, was the firm using? ____________________________________

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Definitions:

Optimal Consumption Rule

The principle that consumers maximize their utility when the ratio of the marginal utility to the price of goods is equal across all goods.

Maximizing Utility

The process by which individuals allocate their resources to obtain the highest possible level of satisfaction.

Income

The amount of money received by an individual or entity in exchange for labor, services, or investment within a specific period.

Concert Tickets

Access passes purchased by individuals to attend live performances of music or other entertainment events.