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Regression analysis
a method for building a statistical model that defines a relationship between a single dependent variable and one or more independent variables, all of which are numerical.
Simple regression model
the value of a time series (the dependent variable) is a function of a single independent variable, time.
method of least squares
Simple linear regression finds the best value of a and b using the ___.
Multiple linear regression model
linear regression model with more than one independent variable
Judgemental forecasting
relies upon opinions and expertise of people in developing forecasts. Used when no historical data is available. Some element of this is always necessary.
Grassroots forecasting
asking those who are close to the end consumer, such as salespeople, about the customers’ purchasing plans.
Delphi method
consists of forecasting by expert opinion by gathering judgments and opinions of key personnel based on their experience and knowledge of the situation.
purpose
The first step in developing a practical forecast is to understand its ___.
Time span
One of the most critical forecasting criteria.
Bias
the tendency of forecasts to consistently be larger or smaller than the actual values of the time series.
The Practical Principles of Forecasting
Use quantitative rather than qualitative methods.
Limit subjective adjustments of quantitative forecasts.
Adjust for events expected in the future.
Ask experts to justify their forecasts in writing.
Use structured procedures to integrate judgmental and quantitative methods.
Combine forecasts from approaches that differ.
If combining forecasts, begin with equal weights.
Compare past performance of various forecasting methods.
Seek feedback about forecasts.
Use multiple measures of forecast accuracy
