Question: The choice of the smoothing constants and has a considerable effect on the accuracy of the forecasts obtained by using exponential smoothing with
The choice of the smoothing constants α and β has a considerable effect on the accuracy of the forecasts obtained by using exponential smoothing with trend. For each of the following time series, set α = 0.2 and then compare MAD obtained with β = 0.1, 0.2, 0.3, 0.4, and 0.5. Begin with initial estimates of 50 for the expected value and 2 for the trend.
(a) 52 55 55 58 59 63 64 66 67 72 73 74
(b) 52 55 59 61 66 69 71 72 73 74 73 74
(c) 52 53 51 50 48 47 49 52 57 62 69 74
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