How does the forecast explosion works for ATO item?

Summary:

We have one ATO item , the structure is as below:

1. Finished Good
   1. Level 1 Part 1
      1. Level 1.1 Part A
      2. Level 1.1 Part B
   2. Level 1 Part 2

In the above case if we load the external forecast at Finished Good Part, will the system explode the forecast and create dependent demand forecast of the lower level BOMs as well?

Content (required):

Version (include the version you are using, if applicable):

Code Snippet (add any code snippets that support your topic, if applicable):