Which Statement Is Correct Regarding Forecasting Using an Exponential Smoothing

question 64

Multiple Choice

Which statement is correct regarding forecasting using an exponential smoothing model?

• A)A model with low α is more responsive to new data than a model with high α.
• B)Increasing α will typically increase the forecast accuracy.
• C)As α increases, more weight is put on recent data.
• D)When data have an upward trend, the forecasts will have an upward bias.

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Definitions:

Marginal Cost

The cost incurred by producing one more unit of a product or service.

Supply Curve

A graph showing the relationship between the price of a good or service and the amount of it that suppliers are willing to offer for sale at each price level.

Law Of Demand

The principle that, other things equal, an increase in a product’s price will reduce the quantity of it demanded, and conversely for a decrease in price.

Government Subsidy

Financial support provided by a government to individuals, businesses, or other governmental entities to support economic activities deemed beneficial.