Describe a situation or problem from your job, everyday life, current events, etc., for which exponential smoothing would be appropriate. What data would you need? Would you expect the value of α (the first smoothing parameter) to be closer to 0 or 1, and why?
Question 7.2
Note: in R, you can use either HoltWinters (simpler to use) or the smooth package’s es function (harder to use, but more general). If you use es, the Holt-Winters model uses model=”AAM” in the function call (the first and second constants are used “A”dditively, and the third (seasonality) is used “M”ultiplicatively; the documentation doesn’t make that clear).
