Assume That the Forecast for the Last Period Is FIT_t

Multiple Choice

Assume that the forecast for the last period is FIT_t = 200 units, and recent experience suggests a likely sales increase of 10 units each period. Actual sales for the last period reached 230 units. Assume a smoothing coefficient of a = 0.20 and a trend smoothing coefficient of β = 0.10. Demand in period t + 1 turned out to be 220. What is the adjusted forecast for period t + 2 (choose the closest answer) ?

A) 227.3
B) 215.9
C) 217.3
D) 221.3