P2 Hw 8- Quantitative Sales Forecasting Flashcards
Times series analysis
Recording data at regular intervals in order to identify trends and make forecasts
Moving averages
A statistic that captures the average change in data series over time. It smooths out some peaks and troughs
Scatter graph
A way of presenting data points on a graph between 2 variables
Line of best fit
A way of showing the trend throughout multiple points of data
Extrapolation
A way of using past sales data to predict future sales data
Quantitative sales forecasts
A method used to predict future sales data
Correlation
How one variable affects another variable
Why is sales forecasting important?
- help with HR and marketing plans
- help know how much stock you will need
- know how many staff you need
- profit and cost budget
- plan production
Why are moving averages helpful?
They flatten out graph peaks and troughs to see where the trend is going
One issue with extrapolation
Assumes the trend will continue, but there are many external factors that can affect/influence it
Types of correlation
Positive- as one variable increases, so does the other variable
Negative- as one variable increases, the other decreases
Zero- there is no discernible relationship between two sets of data
