Problem
Optimizing Holt-Winter's Exponential Smoothing. The table below shows the optimal smoothing constants from applying exponential smoothing to data, using automated model selection:
Level 1,000
Trend 0.000
Seasonality 0.246
a. The value of zero that is obtained for the trend smoothing constant means that (choose one of the following):
• There is no trend.
• The trend is estimated only from the first two periods.
• The trend is updated throughout the data.
• The trend is statistically insignificant.
b. What is the danger of using the optimal smoothing constant values?