Chapter 16, Problem 3PS

You are using exponential smoothing on an annual time series concerning total revenues $\text{(in}\text{\$millions)}\text{.}$ you decide to use a smoothing coefficient of $W=0.20,$ and the exponentially smoothed value for 2017 is $E_{2017}=(0.20)(12.1)+(0.80)(9.4).$

a. What is the smoothed value of this series in 2017?

b. What is the smoothed value of this series in 2018 if the value of the series in this year is $\text{\$11}\text{.5}$ million?