PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Qualitative Forecasts           • Survey Techniques                    – Planned Plant and Equipment Spending             ...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Time-Series Analysis           • Secular Trend                    – Long-Run Increase or Decrease in Data           • Cycl...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Trend Projection           • Linear Trend:             St = S0 + b t             b = Growth per time period           • Co...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Seasonal Variation                                                  Ratio to Trend Method                                 ...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Seasonal Variation                                     Ratio to Trend Method:                                 Example Calc...
Moving Average Forecasts                 Forecast is the average of data from w periods                 prior to the forec...
Exponential Smoothing                                        Forecasts                   Forecast is the weighted average ...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Root Mean Square Error                                           Measures the Accuracy of a                               ...
Barometric Methods            •     National Bureau of Economic Research            •     Department of Commerce          ...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Econometric Models                         Single Equation Model of the Demand                                  for Cereal...
Econometric Models                            Multiple Equation Model of GNP                                              ...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
Input-Output Forecasting                   Three-Sector Input-Output Flow Table                                           ...
Input-Output Forecasting                                    Direct Requirements Matrix                                    ...
Input-Output Forecasting                                      Total Requirements Matrix                                   ...
Input-Output Forecasting                                   Total                                               Final  Tota...
Input-Output Forecasting                           Revised Input-Output Flow Table                                        ...
Chapter 5 AppendixPowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, In...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
PowerPoint Slides Prepared by Robert F. Brooker, Ph.D.   Copyright   2007 by Oxford University Press, Inc. (Adapted by OUP...
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Ch. 5-demand-forecasting(2)

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Microeconomics-Salvatore

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Ch. 5-demand-forecasting(2)

  1. 1. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 1
  2. 2. Qualitative Forecasts • Survey Techniques – Planned Plant and Equipment Spending – Expected Sales and Inventory Changes – Consumers’ Expenditure Plans • Opinion Polls – Business Executives – Sales Force – Consumer IntentionsPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 2
  3. 3. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 3
  4. 4. Time-Series Analysis • Secular Trend – Long-Run Increase or Decrease in Data • Cyclical Fluctuations – Long-Run Cycles of Expansion and Contraction • Seasonal Variation – Regularly Occurring Fluctuations • Irregular or Random InfluencesPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 4
  5. 5. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 5
  6. 6. Trend Projection • Linear Trend: St = S0 + b t b = Growth per time period • Constant Growth Rate St = S0 (1 + g)t g = Growth rate • Estimation of Growth Rate lnSt = lnS0 + t ln(1 + g)PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 6
  7. 7. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 7
  8. 8. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 8
  9. 9. Seasonal Variation Ratio to Trend Method Actual Ratio = Trend Forecast Seasonal Average of Ratios for Adjustment = Each Seasonal Period Adjusted Trend Seasonal Forecast = Forecast AdjustmentPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 9
  10. 10. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 10
  11. 11. Seasonal Variation Ratio to Trend Method: Example Calculation for Quarter 1 Trend Forecast for 1996.1 = 11.90 + (0.394)(17) = 18.60 Seasonally Adjusted Forecast for 1996.1 = (18.60)(0.8869) = 16.50 Trend Year Forecast Actual Ratio 1992.1 12.29 11.00 0.8950 1993.1 13.87 12.00 0.8652 1994.1 15.45 14.00 0.9061 1995.1 17.02 15.00 0.8813 Seasonal Adjustment = 0.8869PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 11
  12. 12. Moving Average Forecasts Forecast is the average of data from w periods prior to the forecast data point. w At i Ft i 1 wPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 12
  13. 13. Exponential Smoothing Forecasts Forecast is the weighted average of of the forecast and the actual value from the prior period. Ft 1 wAt (1 w) Ft 0 w 1PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 13
  14. 14. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 14
  15. 15. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 15
  16. 16. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 16
  17. 17. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 17
  18. 18. Root Mean Square Error Measures the Accuracy of a Forecasting Method ( At Ft ) 2 RMSE nPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 18
  19. 19. Barometric Methods • National Bureau of Economic Research • Department of Commerce • Leading Indicators • Lagging Indicators • Coincident Indicators • Composite Index • Diffusion IndexPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 19
  20. 20. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 20
  21. 21. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 21
  22. 22. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 22
  23. 23. Econometric Models Single Equation Model of the Demand for Cereal (Good X) QX = a0 + a1PX + a2Y + a3N + a4PS + a5PC + a6A + e QX = Quantity of X PS = Price of Muffins PX = Price of Good X PC = Price of Milk Y = Consumer Income A = Advertising N = Size of Population e = Random ErrorPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 23
  24. 24. Econometric Models Multiple Equation Model of GNP Ct a1 b1GNP u1t t It a2 b2 t 1 u2t GNPt Ct It Gt Reduced Form Equation a1 a2 b2 t 1 Gt GNPt b1 1 b1 1 1 b1PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 24
  25. 25. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 25
  26. 26. Input-Output Forecasting Three-Sector Input-Output Flow Table Producing Industry Supplying Final Industry A B C Demand Total A 20 60 30 90 200 B 80 90 20 110 300 C 40 30 10 20 100 Value Added 60 120 40 220 Total 200 300 100 220PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 26
  27. 27. Input-Output Forecasting Direct Requirements Matrix Direct = Input Requirements Requirements Column Total Producing Industry Supplying Industry A B C A 0.1 0.2 0.3 B 0.4 0.3 0.2 C 0.2 0.1 0.1PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 27
  28. 28. Input-Output Forecasting Total Requirements Matrix Producing Industry Supplying Industry A B C A 1.47 0.51 0.60 B 0.96 1.81 0.72 C 0.43 0.31 1.33PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 28
  29. 29. Input-Output Forecasting Total Final Total Requirements Demand Demand Matrix Vector Vector 1.47 0.51 0.60 90 200 0.96 1.81 0.72 110 = 300 0.43 0.31 1.33 20 100PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 29
  30. 30. Input-Output Forecasting Revised Input-Output Flow Table Producing Industry Supplying Final Industry A B C Demand Total A 22 62 31 100 215 B 88 93 21 110 310 C 43 31 10 20 104PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 30
  31. 31. Chapter 5 AppendixPowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 31
  32. 32. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 32
  33. 33. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 33
  34. 34. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 34
  35. 35. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 35
  36. 36. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 36
  37. 37. PowerPoint Slides Prepared by Robert F. Brooker, Ph.D. Copyright 2007 by Oxford University Press, Inc. (Adapted by OUP India, 2008) Slide 37
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