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Forecasting Models for Decision Making

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Two airlines that are merging and the new president, who has to quickly get a handle on the maintenance costs for their entire fleet of planes. The president must act quickly, but accurately, to make the decisions necessary to create a financially sound company.

1. Prepare Peg Young's response to Stephen Ruth.
2. Give support for each step of your decision making.
3. Include a chart

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Forecasting models for decision making are examined. The expert prepares Peg Young's response to Stephen Ruth.

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Relationship between Average Fleet Age and Airframe Cost per Aircraft:
The Scatter Plot between Average Fleet Age and Airframe Cost per Aircraft for Northern Airlines is given as follows:

From the above scatter plot it is evident that for Northern Airlines, there is a linear positive relationship between Average Fleet Age and Airframe Cost per Aircraft. The correlation coefficient between the two attributes is given as 0.877, which is very close to its ideal value of +1, thus indicating a strong positive correlation between the two variables.
The Scatter Plot between ...

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  • MSc, Indian Institute of Technology - Roorkee (I.I.T.-ROORKEE)
  • BSc, Banaras Hindu University
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