When an increasing trend exists in the data and a single exponential smoothing forecast method is used, the forecast will:. a) predict demand perfectly
b) generally underestimate demand
c) capture the trend
d) increase the trend
e) none of the above

The exponential smoothing method is a time series forecasting method of the univariate data that is extended to support systematic trends and seasonal components.

Hence the option D is correct.

Learn more about the increasing trend that exists in the data and a single exponential smoothing.

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c) capture the trend

Explanation:

The exponential smoothing is a forecasting method that is used for a time series and the data i.e. univariate. It could be extended for data support that have the chronological trend

Here in the given situation, if the trend i.e. increased in the data and the above method is used so in the case when the value of the alpha is more it would capture the trend but in the case when the value of the alpha is less so it also capture the demand but the demand is underestimated

Hence, the option c is correct

the correct answer is b.)

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