Forecasting by using least squares, Mathematics

Forecasting By Using Least Squares

Data have been kept of sales over the last seven years

Year

1

2

3

4

5

6

7

Sales (in '000 units

14

17

15

23

18

22

27

It is required to forecast the sales for the 8th year

Solution

Years (x)

Sales (y)

xy

x2

1

14

14

1

2

17

34

4

3

15

45

9

4

23

92

16

5

18

90

25

6

22

132

36

7

27

189

49

       Σx=28

     Σy = 136

       Σxy=596

    Σx2= 140

136 = 7a + 28b

596 = 28a + 140b

∴b = 1.86

And substituting in one of the equations we acquire

a = 12

∴ Regression line = y = 12 + 1.86x

Or, Sales in ('000s of units) = 12.00 + 1.86 (no of years)

We utilize this expression for forecasting, for 8th year sales = 12 + 1.86 (8)

=26.88 that is 26,888 units.

Posted Date: 2/16/2013 7:49:36 AM | Location : United States







Related Discussions:- Forecasting by using least squares, Assignment Help, Ask Question on Forecasting by using least squares, Get Answer, Expert's Help, Forecasting by using least squares Discussions

Write discussion on Forecasting by using least squares
Your posts are moderated
Related Questions
Using the sketch below and the fact that ∠A + ∠B + ∠C + ∠D = 325, Determine m∠E.   a. 81° b. 35° c. 25° d. 75° b. The addition of the measures of the exterio

Positive Skewness - It is the tendency of a described frequency curve leaning towards the left. In a positively skewed distribution, the long tail extended to the right. In

With reference to Fig. 1(a) show that the magnification of an object is given by M=SID/SOD. With reference to Fig. 1(b) show that the size of the penumbra (blur) f is given by f

Are there more rational numbers than integers?#

1.) How does the monsoon influence the climate and vegetation of Southeast Asia? 2.) What is the main crop in Southeast Asia and the main systems by which it is produce? How and

The C.P. of 20 articles is same as theS.P. of x articles.Article profit is 25%.Find x

a man in rested rupee 800 is buying rupee 5 shares and then are selling at premium of rupee 1.15. He sells all the shares.find profit

Linda bought 35 yards of fencing at $4.88 a yard. How much did she spend? To multiply decimals, multiply generally, count the number of decimal places in the problem, then us

Consider the function f(x) =1/2 (2 x +2 -x ) which has the graph (a) Explain why f has no inverse function. You should include an example to support your explanation

Finding the Equation of a line, Given a Slope and a Point ? Find the equation of a line with slope m = 2, which passes through the point (-1, -3). Solution: Use the po