A firm knows that there are 200,000 households in a given community, and that 35 percent of them own at least one home computer. The firm estimates that 5 percent of the home personal computers will require servicing in a given year, and that it will have a 10 percent market share. The company is using what sales forecasting technique?
A) Trend analysis
B) Market share analysis
C) Chain-ratio method
D) Market buildup method

Question

Quizplus · Accepted Answer

The chain-ratio method is used here as it involves breaking down the total market into smaller segments and applying a series of percentages to estimate the potential sales, such as the percentage of households owning computers, the percentage needing servicing, and the firm's market share.

A Firm Knows That There Are 200,000 Households in a Given