Suppose That Simple Exponential Smoothing with Is Used to Forecast

question 55

Essay

Suppose that simple exponential smoothing with is used to forecast monthly wine sales at a liquor store. After April's demand is observed, the forecasted demand for May is 4500 bottles of wine.
-(A) At the beginning of May, what is the forecast of July's wine sales?
(B) Suppose that actual demands during May and June are as follows: May, 5000 bottle of wine; June 4000 bottle of wine. After observing June's demand, what is the forecast for July's demand?
(C) Based on the data from (B), the demands during May and June average (5000+4000)/2 = 4500 bottle per month. This is the same as the forecast for monthly sales before we observed the May and June data. Yet after we observe the May and June demands for wine, our forecast for July demand has decreased from what it was at the end of April. Why?

Recognize the implications of unknown population standard deviation on interval estimation.

Apply formulas for calculating confidence intervals in practical situations.

Understand the concept and application of skill-based pay systems.

Analyze and calculate compensation ratios (compa-ratios) and understand their implications for pay structure management.

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Definitions:

Tukey Test

A statistical test used to compare the means of three or more groups to find which pairs of groups differ significantly.

Familywise Error

The probability of making one or more Type I errors across a set of statistical tests.

Critical Value

A point on the scale of the test statistic beyond which we reject the null hypothesis; it determines the cut-off point for significance in hypothesis testing.

Dunnett Test

A statistical test used to compare multiple groups against a single control group without increasing the type I error rate.