BUSINESS FORECASTING

Coursework Assignment
Question 1

(a) The attached data shows monthly warehouse store sales (in million dollars) in the USA from Jan. 1992 to Jun. 2004, inclusive. Obtain a time plot of the data.
(b) Choose, giving your reasons, which exponential smoothing method is likely to be the most suitable for producing forecasts with this data set. Using the mean absolute percentage error (MAPE) as the measure of accuracy, obtain, by trial and error, optimum smoothing constants (up to two decimal places) for this set of data.
(c) Use your chosen exponential smoothing method and optimal smoothing constants to produce forecasts for each of the months from Jul. 2004 to Feb. 2005, inclusive.
(d) Suppose you are in the management services branch of a USA warehouse superstore and that you have just developed the method in part (b), and produced the forecasts in part (c).The actual warehouse store sales (in million dollars) for the periods forecasted in part(c) was as follows;

Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 Jan-05 Feb-05
20549 20477 19108 21013 22486 28274 19813 19691

Write a short report to your head of branch, commenting on the exercise. You should include reference to the accuracy of the forecasts, and the likely accuracy of the method for producing forecasts up to 8 months ahead on a regular basis; potential problems/advantages of the method for producing such forecasts, and how the forecasts might be integrated into the planning operations of your firm.
(up to about 2 pages in 12 point font, single spaced or equivalent, for Q1(d) )

Question 2
Briefly describe some of the decision-making areas within firms or organisations where forecasts of various types have made a useful contribution. Select two of these areas and expand on the forecasting operation within these areas. (up to about 3 pages max for Q2.)

business forecasting

By understanding of the value of forecasting in a business environment.
Preparing a forecast will provide you with the skills to apply quantitative and qualitative forecasting techniques when required for business decision making.
The analysis of a volume of actual data will require application of a spreadsheet, supporting the value of software programs in facilitating the use of time series
data. Research using the internet will increase your knowledge of data availability for use in business forecasting.

Business Forecasting (FOR300)
Assignment 2
Australian Marriage
Due: Week 8 – Week 10
Submit: 1) Moodle Turn-it-in and 2) a hard copy to the lecturer.
Word Count: Report 1,800 – 2,000 words.
Weighting: This assignment represents 30% of your overall assessment for Business Forecasting.
Learning Outcomes: By exploring the application of business forecasts you will gain an understanding of the value of forecasting in a business environment. Preparing a forecast will provide you with the skills to apply quantitative and qualitative forecasting techniques when required for business decision making. The analysis of a volume of actual data will require application of a spreadsheet, supporting the value of software programs in facilitating the use of time series data. Research using the internet will increase your knowledge of data availability for use in business forecasting.
Task: use the data on the ‘Selected Marriage Indicators’ table from the ABS to complete this task
1. Forecast ‘Marriages Registered’ and ‘First Marriage Both Partners’. Prepare line graphs for each forecast and the actual raw data on the same axes.
2. Forecast ‘Marriage Celebrant: Ministers of Religion’ and ‘Marriage Celebrant: Civil Celebrant’. Prepare line graphs for these forecasts and the actuals on the same axes.
3. Explain by whom and for what purpose the forecasts would be used. Provide examples of decisions that would be made based on the forecasts, including the consequences of incorrect decisions.
4. Based on the uses and consequences, determine an acceptable level of accuracy for the forecasts.
5. Use graphing software to calculate the Centred Moving Average (CMA) for the ‘Marriages Registered’. Prepare a line graph showing actual data and CMA on the same graph.
6. Observe the data and graph for trends, cycles or irregularities. Include details of your observations in your report. Explain why some of these may not be apparent or exist at all.

business forecasting

By understanding of the value of forecasting in a business environment.
Preparing a forecast will provide you with the skills to apply quantitative and qualitative forecasting techniques when required for business decision making.
The analysis of a volume of actual data will require application of a spreadsheet, supporting the value of software programs in facilitating the use of time series
data. Research using the internet will increase your knowledge of data availability for use in business forecasting.

Business Forecasting (FOR300)
Assignment 2
Australian Marriage
Due: Week 8 – Week 10
Submit: 1) Moodle Turn-it-in and 2) a hard copy to the lecturer.
Word Count: Report 1,800 – 2,000 words.
Weighting: This assignment represents 30% of your overall assessment for Business Forecasting.
Learning Outcomes: By exploring the application of business forecasts you will gain an understanding of the value of forecasting in a business environment. Preparing a forecast will provide you with the skills to apply quantitative and qualitative forecasting techniques when required for business decision making. The analysis of a volume of actual data will require application of a spreadsheet, supporting the value of software programs in facilitating the use of time series data. Research using the internet will increase your knowledge of data availability for use in business forecasting.
Task: use the data on the ‘Selected Marriage Indicators’ table from the ABS to complete this task
1. Forecast ‘Marriages Registered’ and ‘First Marriage Both Partners’. Prepare line graphs for each forecast and the actual raw data on the same axes.
2. Forecast ‘Marriage Celebrant: Ministers of Religion’ and ‘Marriage Celebrant: Civil Celebrant’. Prepare line graphs for these forecasts and the actuals on the same axes.
3. Explain by whom and for what purpose the forecasts would be used. Provide examples of decisions that would be made based on the forecasts, including the consequences of incorrect decisions.
4. Based on the uses and consequences, determine an acceptable level of accuracy for the forecasts.
5. Use graphing software to calculate the Centred Moving Average (CMA) for the ‘Marriages Registered’. Prepare a line graph showing actual data and CMA on the same graph.
6. Observe the data and graph for trends, cycles or irregularities. Include details of your observations in your report. Explain why some of these may not be apparent or exist at all.