Oracle E-Business Suite R12.1: Order Management Essentials — Question 20

What is true about a (alpha. in the Exponential Smoothing Forecast (ESF. method?

Answer options

• A. α(alphA. equals the old forecast.
• B. α(alphA. Is always greater than one.
• C. α(alphA. Is calculated by Oracle Inventory.
• D. α(alphA. is multiplied by the forecast error to determine the adjustment.
• E. α(alphA. equals the old forecast plus a portion of the forecast error from the previousperiod.

Correct answer: D

Explanation

The correct answer is D because, in the Exponential Smoothing Forecast method, alpha (α) is indeed multiplied by the forecast error to adjust the forecast. Option A is incorrect because α does not equal the old forecast, B is wrong as α is typically between 0 and 1, C is not true since α is not specifically calculated by Oracle Inventory, and E misrepresents the calculation of α in this context.