Answer to Question #301290 in Management for Obama

Question

1. The table mentioned below shows the “Gross Production of Energy by Two Sources in

India from 2010-11 to 2015-16”.

Adopt Exponential Smoothing Method. Consider the Alpha (α) values 0.2, 0.5, 0.7 and

find out the one that is comparatively good for the prediction.

Forecast the value for year 2016-17.

Year Coal - (Million Tones) Lignite - (Million Tones)

2010-11 532.7 37.73

2011-12 539.95 42.33

2012-13 556.4 46.45

2013-14 565.77 44.27

2014-15 609.18 48.27

2015-16 639.23 43.84

Source: Open Government Data (OGD) Platform India

Answer 1

The lignite company, compared to the coal company is good for prediction. This is because the output given by the coal company is smaller and fluctuates while the one produced by lignite company is steadier and larger. With the alpha values 0.2, 0.5 and 0.7 the best to use is 0.5. This is because, it is steadier and it accommodates the two companies well.