Assignment 2: Applications of Forecasting by Firms
Forecasting is used as a tool for planning. When developing forecasts, firms need to think of all possible scenarios and their future impacts.
For example, if you are in a management role and overforecast sales, you will then overforecast employees or payroll as you will schedule more employees than needed to meet your projected sales. This overforecasting will lead to excess purchasing of supplies and, ultimately, lead to insufficient cash flows because you will need to pay for expenses incurred to maintain and provide services for revenues that did not come in as projected. A small error in forecasting at the start can significantly affect overall results. In this assignment, you will be exposed to the basic principles of forecasting.
Tasks:
Research a firm that applies forecasting principles and methods. Y