Average starting salaries for students using a placement service at a university have een steadily increasing. A study of the last four graduating classes indicates the llowing average salaries: $30,000, $32,000, $34,500, and $36,000 (last graduating ass). Predict the starting salary for the next graduating class using a simple

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6. Average starting salaries for students using a placement service at a university have
been steadily increasing. A study of the last four graduating classes indicates the
following average salaries: $30,000, $32,000, $34,500, and $36,000 (last graduating
class). Predict the starting salary for the next graduating class using a simple
exponential smoothing model with a = 0.25. Assume that the initial forecast was
$30,000 (so that the forecast and the actual were the same).
Transcribed Image Text:6. Average starting salaries for students using a placement service at a university have been steadily increasing. A study of the last four graduating classes indicates the following average salaries: $30,000, $32,000, $34,500, and $36,000 (last graduating class). Predict the starting salary for the next graduating class using a simple exponential smoothing model with a = 0.25. Assume that the initial forecast was $30,000 (so that the forecast and the actual were the same).
Expert Solution
Step 1

Given information:

Given data represents the average salaries of last four graduating classes.

Given that the initial forecast value is F1 = 30000.

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