Question: The manager of a small health clinic would like to use exponential smoothing to forecast demand for emergency services in the facility. However, she is not sure whether to use a high or low value of ?. To make her decision, she would like to compare the forecast accuracy of a high and low ? on historical data. She has decided to use an ? = 0.7 for the high value and ? = 0.1 for the low value.
For both alpha values, enter exponential smoothing forecasts for weeks 2-6, and calculate the MAD for each alpha value.
Week Demand
(in patients serviced)
1 430
2 289
3 367
4 470
5 468
6 365
It would be better to use ? =