- 20 Marks
QTB – Nov 2014 – L1 – SB – Q4 – Forecasting
Analyze sales data using the Least Squares Method and forecast future sales based on the trend.
Question
The sales of PQR Nigeria Plc. in thousands of Naira are listed in the table below for each quarter for years 2005 – 2008.
Sales of PQR in N’000s
| Year | Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 |
|---|---|---|---|---|
| 2005 | 22 | 35 | 82 | 37 |
| 2006 | 24 | 46 | 81 | 44 |
| 2007 | 25 | 40 | 87 | 49 |
| 2008 | 29 | 42 | 100 | 55 |
Required:
a. Calculate the trend in the above data using the Least Squares Method. (12 Marks)
b. Estimate the sales for each quarter using the trend line. (4 Marks)
c. Calculate the percentage variation for each quarter’s actual sales from the estimate obtained in (b) above. (4 Marks)
(Total: 20 Marks)
Find Related Questions by Tags, levels, etc.
- Tags: Least Squares, Sales Forecasting, Time series, Trend Estimation
- Level: Level 1
- Topic: Forecasting
- Series: NOV 2014
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