Which of the Following Smoothing Constants Would Make an Exponential

question 137

Multiple Choice

Which of the following smoothing constants would make an exponential smoothing forecast equivalent to a naive forecast?

• A) 0
• B) .01
• C) .1
• D) .5
• E) 1.0

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Definitions:

Flotation Costs

Expenses incurred by a company in issuing new securities, typically including fees for underwriting, legal, registration, and other associated costs.

Debt-to-Assets Ratio

A leverage ratio that calculates the total amount of debt relative to the total amount of assets, indicating how much of the company's assets are funded by debt.

Cost of Equity

The rate of return that a company theoretically pays to its equity investors to compensate for the risk they undertake by investing in the company.

Cost of Equity

The return that investors expect for investing in a company's equity, considered the cost of equity capital.