2.
A) Fred's Hardware and Hobby House expects its sales to increase at a constant rate of 8 percent per year over the next three years. Currents sales are $100,000. Forecast sales for each of the next years.
1st year: 100,000 x 1.08=108,000
2nd year: 108,000 x 1.08=116,640
3rd year: 116,640x 1.08=125,971.20
B) If sales in 2004 were $60,000 and they grew to $100,000 by 2008 (a four year period), what was the actual annual compound growth rate?
The actual annual compound growth rate is found with the formula (FV/PV)^1/n - 1 where FV is the future value, PV is the present value, and n is the number of years. This gives us
(100,000/60,000)^1/4 - 1 =.136, or 13.6%
6. The economic analysis division of Mapco Enterprises estimated the demand functions for its line of weed trimmers as:
Q¬D= 18,000 + 0.4N - 350PM + 90PS
Where N = number of new ...
Solution Summary
Predicting future sales volume based on past sales data from several hypothetical companies
... It is an attempt to develop forecasts through group ... then they combine their conclusions into a forecast. ... Slide 40 40 Qualitative Approaches to Forecasting. ...
...forecasting system (naturally) using just two forecasting techniques. ... is simply that this period's demand will equal ... which model will make the forecast for the ...
... have to deal with business forecasts and projections. Business forecast allows the companies and its ... Through forecasting, business firms can also create ...
... are widely used where repeated forecast required-uses ... average form of time series forecasting-efficient to ... ideal for situations where many forecasts must be ...
... 3. Compare the forecasts developed in parts 1 and ... the difference of actual demand and forecast is considered ... average is a less efficient method of forecasting. ...
... solution gives step by step method for forecasting sales for ... Thus the Forecast for next January = (550+510+480 ... 625 Variable A ctual 600 Fits Forecasts 95.0% PI ...
... t-1 0.6 Weight for period t-2 0.3 (Note: Generally the most recent period is given the highest weight) Weight for period t-3 0.1 Month Demand Forecast Jan 12 ...
