The trend forecast equation is Ŷ = 50 + 420t. The next forecast is for period 10. The typical seasonal index for period 10 is 0.82. What are the forecast sales for period 10?
A) 4,200
B) 4,250
C) 4,000
D) 3,485

Question

Quizplus · Accepted Answer

The forecast sales for period 10 is calculated by first finding the trend forecast: Ŷ = 50 + 420(10) = 4,250. Then, apply the seasonal index: 4,250 * 0.82 = 3,485.

The Trend Forecast Equation Is Ŷ = 50 + 420t