A Company Keeps Track of Unit Sales and Notes a Strong

Multiple Choice

A company keeps track of unit sales and notes a strong trend during the past eight periods. They use an adjusted exponential smoothing model with an alpha equal to 0.7 and a beta equal to 0.6. Using the demand data and previous forecasts shown in the table, develop a forecast for period 4. $$\begin{array} { | c | c | c | c | c | } \hline \text { Week } & \text { \# Units } & \begin{array} { c } \text { Unadjusted } \\\text { Forecast }\end{array} & \text { Trend } & \begin{array} { c } \text { Adjusted } \\\text { Forecast }\end{array} \\\hline 1 & 68 & 65.0 & 0.0 & 65.0 \\\hline 2 & 72 & 67.1 & 1.3 & 68.4 \\\hline 3 & 80 & & & \\\hline 4 & 93 & & & \\\hline 5 & 108 & & & \\\hline 6 & 121 & & & \\\hline 7 & 125 & & & \\\hline 8 & 139 & & & \\\hline\end{array}$$

A) 82.2
B) 84.9
C) 87.5
D) 91.6