As Alpha Increases the Exponential Smoothing Model

question 19

Multiple Choice

As alpha increases the exponential smoothing model

• A) produces sluggish forecasts.
• B) reacts quickly to changes in the data.
• C) reacts slowly to changes in the data.
• D) does not change.

---

Definitions:

Price Discriminate

The practice of charging different prices to different consumers for the same good or service, based on differing willingness to pay.

First-Degree Price Discrimination

A pricing strategy where a seller charges each customer the maximum price they are willing to pay.

Producer Surplus

The difference between the amount a producer is paid for a good versus what they would have been willing to accept, reflecting the benefit to producers from participating in the market.

Consumer Surplus

The difference between the total amount consumers are willing to pay for a good or service and the total amount they actually pay.