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Giovanni Food Products produces and sells frozen pizzas to public schools throughout the eastern United States. Using a very aggressive marketing strategy they have been able to increase their annual revenue by approximately $10 million over the past 10 years. But, increased competition has slowed their growth rate in the past few years. The annual revenue, in millions of dollars, for the previous 10 years is shown below.
1
8.53
2
10.84
3
12.98
4
14.11
5
16.31
6
17.21
7
18.37
8
18.45
9
18.40
10
18.43
a. Construct a time series plot. Comment on the appropriateness of a linear trend.
b. Using Excel Solver or LINGO, develop a quadratic trend equation that can be used to forecast revenue.
c. Using the trend equation developed in part (b), forecast revenue in year 11.
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