Integrated Products Corporation (IPC) needs to estimate its PC sales for next year. The most recent six years of revenue data for the company’s line of XT Personal Computers, and those of the industry, is found in the table below: Year XT PC Sales Revenue ($’000,000) All Industry PC Sales Revenue ($’000,000,000) 1 2.4 4.6 2 5.9 8.6 3 15.5 10.7 4 27.8 14.8 5 35.9 18.5 6 38.1 19.4 Required: A. Assuming that the sales data above are representative of sales expected next year, use time series regression analysis to forecast next year’s sales revenues (there is no seasonal effect). B. Perform a regression analysis between the annual sales revenues of XT Personal Computers and all industry PC annual sales revenues. What is the forecast for next year’s sales revenue for XT Personal Computers if the estimate of next year’s industry PC sales revenues is $21.9 billion? C. Advise management at Integrated Products Corporation (IPC) which of the two sales estimates from parts A and B above they should use. Justify your advice.
Integrated Products Corporation (IPC) needs to estimate its PC sales for next year. The most recent six years of revenue data for the company’s line of XT Personal Computers, and those of the industry, is found in the table below: Year XT PC Sales Revenue ($’000,000) All Industry PC Sales Revenue ($’000,000,000) 1 2.4 4.6 2 5.9 8.6 3 15.5 10.7 4 27.8 14.8 5 35.9 18.5 6 38.1 19.4 Required: A. Assuming that the sales data above are representative of sales expected next year, use time series regression analysis to forecast next year’s sales revenues (there is no seasonal effect). B. Perform a regression analysis between the annual sales revenues of XT Personal Computers and all industry PC annual sales revenues. What is the forecast for next year’s sales revenue for XT Personal Computers if the estimate of next year’s industry PC sales revenues is $21.9 billion? C. Advise management at Integrated Products Corporation (IPC) which of the two sales estimates from parts A and B above they should use. Justify your advice.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
Related questions
Question
Integrated Products Corporation (IPC) needs to estimate its PC sales for next year.
The most recent six years of revenue data for the company’s line of XT Personal
Computers, and those of the industry, is found in the table below:
| Year | XT PC Sales Revenue ($’000,000) |
All Industry PC Sales Revenue ($’000,000,000) |
| 1 | 2.4 | 4.6 |
| 2 | 5.9 | 8.6 |
| 3 | 15.5 | 10.7 |
| 4 | 27.8 | 14.8 |
| 5 | 35.9 | 18.5 |
| 6 | 38.1 | 19.4 |
Required:
A. Assuming that the sales data above are representative of sales expected next
year, use time series regression analysis to
(there is no seasonal effect).
B. Perform a regression analysis between the annual sales revenues of XT
Personal Computers and all industry PC annual sales revenues. What is the
forecast for next year’s sales revenue for XT Personal Computers if the estimate
of next year’s industry PC sales revenues is $21.9 billion?
C. Advise management at Integrated Products Corporation (IPC) which of the two
sales estimates from parts A and B above they should use. Justify your advice.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 5 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.Recommended textbooks for you
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.