Certified Production & Operations Manager (POM) Practice Exam

Using trend-adjusted smoothing, what is the forecast for student enrollments this year if past conditions are known?

1. 22800

2. 21000

3. 19500

4. 22650

The correct answer is: 22650

To determine the forecast for student enrollments this year using trend-adjusted smoothing, one must consider the underlying methodology used in this forecasting technique. Trend-adjusted smoothing takes into account not only the historical data points but also the trend observed over time. This method combines a level component, which reflects the current average, and a trend component, which indicates whether enrollments are generally increasing or decreasing. By successfully applying the trend-adjusted smoothing formula and considering previous levels of enrollments as well as the trend direction, the resulting forecast can shift either upwards or downwards, reflecting a more accurate future prediction. In this case, arriving at a forecast of 22,650 suggests that the combination of the historical average and adjustments for the observed trend leads to this value. This figure likely indicates that there has been consistent growth or stabilization in enrollments, which the trend-adjusted smoothing effectively captures, making it the most reliable prediction based on past conditions. The other figures might not reflect the same balance of trend and level, hence they would not be considered the best estimate for this year's enrollments.