This preview shows pages 1–2. Sign up to view the full content.
This preview has intentionally blurred sections. Sign up to view the full version.View Full Document
Unformatted text preview: Forecasting Business forecasting is an estimate or prediction of future developments in business such as sales, expenditures, and profits. Given the wide swings in economic activity and the drastic effects these fluctuations can have on profit margins, it is not surprising that business forecasting has emerged as one of the most important features of corporate planning. Forecasting has become an invaluable tool for businesspeople to antedate economic trends and prepare themselves either to benefit from or to counteract them. If, for instance, businesspeople imagine an economic downturn, they can cut back on their inventories, production quotas, and hiring. If, on the contrary, an economic boom seems probable, those same businesspeople can take necessary measures to attain the maximum benefit from it. Good business forecasts can help business owners and managers adapt to a changing economy (Business Forecasting, 2003). Forecasting can either be qualitative or quantitative. In the qualitative forecasting method the forecast is made intuitively by the forecaster. In the quantitative forecasting method the forecast is based on mathematical modeling. The time series model assumes that all the forecast is based on mathematical modeling....
View Full Document
- Fall '10