a) Use revenue data listed in the table to compute the four-period moving average and enter your values in the appropriate columns. b) Plot the data and describe the main features of the series. c) Calculate the Centered Moving Average (CMA). Interpret it. d) Determine the Seasonality (St) and interpret it properly e) Calculate and interpret the Ftrend. f) Forecast the revenue for the year 2021 Q1 to Q4 g) Based on these results, what recommendation would you provide to this company to boost its sales? Also, what are the associated risks?
Multiplicative Forecasting
Suppose that you have gathered quarterly sales data of a company between 2014 and 2019. Consider the company’s prior sales and use it to forecast their quarterly sales in 2021. The amount of sales from 2014-2019 is reported in Table 2.
Table 2 - Sales from 2014-2019
|
Year |
Q |
Revenue |
Four Moving Average |
Centered Moving Average |
Seasonality |
Deseasonality |
Ftrend |
Forecast |
|---|---|---|---|---|---|---|---|---|
|
2014 |
1 |
789 |
|
|
|
|
|
|
|
2014 |
2 |
1020 |
|
|
|
|
|
|
|
2014 |
3 |
945 |
|
|
|
|
|
|
|
2014 |
4 |
883 |
|
|
|
|
|
|
|
2015 |
1 |
926 |
|
|
|
|
|
|
|
2015 |
2 |
958 |
|
|
|
|
|
|
|
2015 |
3 |
896 |
|
|
|
|
|
|
|
2015 |
4 |
1134 |
|
|
|
|
|
|
|
2016 |
1 |
902 |
|
|
|
|
|
|
|
2016 |
2 |
1345 |
|
|
|
|
|
|
|
2016 |
3 |
845 |
|
|
|
|
|
|
|
2016 |
4 |
1130 |
|
|
|
|
|
|
|
2017 |
1 |
1120 |
|
|
|
|
|
|
|
2017 |
2 |
1340 |
|
|
|
|
|
|
|
2017 |
3 |
1020 |
|
|
|
|
|
|
|
2017 |
4 |
980 |
|
|
|
|
|
|
|
2018 |
1 |
895 |
|
|
|
|
|
|
|
2018 |
2 |
1230 |
|
|
|
|
|
|
|
2018 |
3 |
777 |
|
|
|
|
|
|
|
2018 |
4 |
925 |
|
|
|
|
|
|
|
2019 |
1 |
784 |
|
|
|
|
|
|
|
2019 |
2 |
936 |
|
|
|
|
|
|
|
2019 |
3 |
1102 |
|
|
|
|
|
|
|
2019 |
4 |
1207 |
|
|
|
|
|
|
a) Use revenue data listed in the table to compute the four-period moving average and enter your values in the appropriate columns.
b) Plot the data and describe the main features of the series.
c) Calculate the Centered Moving Average (CMA). Interpret it.
d) Determine the Seasonality (St) and interpret it properly
e) Calculate and interpret the Ftrend.
f) Forecast the revenue for the year 2021 Q1 to Q4
g) Based on these results, what recommendation would you provide to this company to boost its sales? Also, what are the associated risks?
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