COMMERCE 4OB3 Lecture Notes - Lecture 4: Large Deviations Theory, Business Cycle, Moving Average
22 Mar 2016
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Document Summary
Forecasing: the art and science of predicing events. 3 categories of forecasts/future ime horizons: 1. short-range forecast: has a ime span of up to one year and is generally less than three months. Used for planning purchasing, job scheduling, workforce levels, job assignments, and producion levels: 2. Useful in sales planning, producion planning and budgeing, cash budgeing, and analysis of operaing plans: 3. Long-range forecast: 3 or more years, used in planning new products, capital expenditures, facility locaion or expansion, and research and development. Medium and long range forecasts are disinguished from short-range forecasts by 3 features: 1. intermediate and long-run forecasts deal with more comprehensive issues, 2. Short term forecasing employs diferent methodologies than longer term forecasing such as moving averages, exponenial smoothing, and trend extrapolaion: 3. Short range forecasts tend to be more accurate than longer forecasts. Four stages of a product life cycle: 1. introducion, 2. growth, 3. maturity, 4. decline.
