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Forecast the sales for the home improvements market - Mexico

Forecast the sales for the home improvements market for Mexico City for 2007 using expenditures per household as the explanatory (independent) variable in a linear regression analysis. Graph the actual and forecasted data. See attached for data.

Select another possible explanatory variable, in addition to expenditures per household that could be used to forecast annual sales for the home improvement market in Mexico City. Discuss why this variable may be a good predictor of sales and where you could obtain data on this variable. Then using at least nine years of such data (predicted if necessary), calculate a second linear regression equation using your selected variable.
Year Population
2000 99,927
2001 101,247
2002 102,480
2003 103,718
2004 104,960
2005 106,203
2006 107,450
2007 108,701

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See the attached file for complete solution. The text here may not be copied exactly as some of the symbols / tables may not print. Thanks

Year Home improvement sales Expenditures per household Population Forecast using HI Expenditure Forecast Using ...

Solution Summary

Demonstrates how to work with actual data to make sales forecast.