You are using an exponential smoothing on an annual time series concerning total revenues (in $millions). You decide to use a smoothing coefficient of W = .2, and the exponentially smoothed value for 2017 is E[2017] = (.2)(12.1) + (.8)(9.4). What is the smoothed value of this series in 2017?
The smoothed value of the series in 2017 is:
E[2017] = (.2)(12.1) + (.8)(9.4)
= 2.42 + 7.52
= 9.94
So, the smoothed value of the series in 2017 is 9.94 million dollars.