What is the initial forecast assumption if no prior forecast is provided for the first period?

If no forecast value for the first period is given, the standard assumption is to set the first forecast equal to the first actual value, expressed as

F_1 = A_1

. This provides a starting point for the exponential smoothing calculations.

Conditions

No initial forecast value is provided for the first period.
You are beginning an exponential smoothing calculation.

Reasoning, step by step

Identify the actual sales value for the first period ( $A_1$ ).
Set the forecast for the first period ( $F_1$ ) equal to $A_1$ .
Use this $F_1$ value to begin calculating subsequent forecasts.

Example

In the video's example, the actual sales for week 1 is 39. Since no prior forecast is given, the initial forecast is assumed to be $F_1 = 39$ .

Common misconceptions

Assuming the first forecast is zero.
Guessing the first forecast based on external data not provided in the problem.

Watch the explanation

YouTubeForecasting: Exponential Smoothing, MSE

1:54 – 2:17Watch this moment ↗

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Answers are generated from source material and independently checked. Consult the original video or creator if something is unclear.