Forecasting Methods

Question 1

Judgemental Method

Answer 1

-> the notion that the next time period will be the same as the previous
-> salespeople make a guess or estimate

Question 2

Counting Method

Answer 2

-> test marketing and demand estimation
-> this provides survey research which provides insights

Question 3

Time Series Method

Answer 3

-> historical sales are analysed
-> underlying trend is projected into the future and where random variation is cancelled or reduced using smoothing techniques

Question 4

Causal Method

Answer 4

-> this is the relationship between the independent and the dependent variable of interest
-> this can be discovered using tools like scatter plots, regression and correlation
-> discounts