Answer:
The forecast for September using exponential smoothing with alpha = 0.4 is 62.
Explanation:
Forecasting Formula
Forecasting the next point is determined using the forecasting formula is the basic equation
S(t+1)=αy(t)+(1−α)S(t), 0<α≤1,t>0.
α = alpha =0.4
New forecast S(t+1) is previous forecast S(t) plus an error adjustment. This can be written as:
S(t+1)=S(t)+αϵ(t),
where ϵ(t) is the forecast error (actual - forecast) for period t.
In other words, the new forecast is the old one plus an adjustment for the error that occurred in the last forecast.
New forecast for August S(t+1) = 0.4×60 + (1-0.4)×70
= 66
New forecast for September S(t+1) =0.4×56 + (1-0.4)×66
=62
