I n the previous example, we saw that the moving averages method was able to provide only fair forecasts of weekly hardware sales at Lee’s. Using the best of three potential spans, its forecasts were...

I n the previous example, we saw that the moving averages method was able to provide only fair forecasts of weekly hardware sales at Lee’s. Using the best of three potential spans, its forecasts were still off by about 13.9% on average. The company would now like to try simple exponential smoothing to see whether this method, with an appropriate smoothing constant, can outperform the moving averages method. How should the company proceed?

Objective To see whether simple exponential smoothing with an appropriate smoothing constant can provide more accurate forecasts of weekly hardware sales than the moving averages forecasts.