Projecting Revenues Flashcards
1
Q
Growth relative to GDP growth
A
-Top down approach
-comparing the growth of a company to the nominal GDP growth
2
Q
Market growth and market share approach
A
-Top down
Steps:
1.forecast growth
2.assess the current or desired market share
3.forecast the evolution of the market share
3
Q
Time series
A
-Bottom up
-theoretical growth based on historical growth rate or time series analysis
4
Q
Return on capital
A
-bottom up
-balance sheet accounts are the source of projecting revenues
5
Q
Capacity-based stores
A
Same store sales growth and sales related to new stores form the basis for projecting revenues
6
Q
Aligning to competition
A
Other approaches
7
Q
Combining elements of both previous approaches
A
-blended approach
-most commonly used
