Use regression to develop a trend line

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Reference no: EM13992385

1. Prepare a graph of the data. On this same graph, plot a12-month moving average forecast. Discuss any apparent trend and seasonal patterns.

2. Use regression to develop a trend line that could be used to forecast monthly sales for the next year. Is the slope of this line consistent with what you observed in question 1? If not, discuss a possible explanation.

3. Use the multiplicative decomposition model on these data. Use this model to forecast sales for each month of the next year. Discuss why the slope of the trend equation with this model is so different from that of the trend equation in question 2.

Monthly Revenue (in $1,000s)

MONTH 2008 2009 2010

January 438 444 450

February 420 425 438

March 414 423 434

April 318 331 338

May 306 318 331

June 240 245 254

July 240 255 264

August 216 223 231

September 198 210 224

October 225 233 243

November 270 278 289

December 315 322 335

Reference no: EM13992385

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