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# Need to develop a monthly forecast using a regression model,

Need to develop a monthly forecast using a regression model, for one year. What variables could be chosen to use in the modeling?

What are some of the benefits and negatives of each of these variables.

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#### Solution Preview

The monthly sales of cold beverages can be a function of the following variable:
1. Weather (W), i.e. average monthly temperature.
2. The seasonality (S), i.e. Public Holidays/Easter/Christmas/NewYear/Thanksgiving
3. The variability (V) of products on offer.
Any regression model should be a multi-variable regression. So sales of cold beverage can be expressed as:
Sales = a*W + b*S + c*V + d

First, let's talk about the weather factor. Of course, when you are selling cold beverage, one would imagine that in warmer times of the year, i.e. summer, the sales will be higher than in colder times. ...

#### Solution Summary

The solution provides detailed explanations for the problem using the cold beverage sale example.

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