The manager of the health clinic in Problem 5 would also like to use exponential smoothing to forecast demand for emergency services in the facility. As in Problem 5, she is not sure whether to use a high or low value of α. To make her decision, she would like to compare the forecast accuracy of a high and low α on historical data. Again, she has decided to use an α = 0.7 for the high value and α = 0.1 for the low value.

(a) Given the following historical data, which value of α do you think would be better to use?

(b) Is your answer the same as in Problem 5? Why or why not?

Demand Week   (in patients serviced)

1                                  430

2                                  289

3                                  367

4                                  470

5                                  468

6                                  365