The following equation summarizes the trend portion of quarterly sales of automa

Question

The following equation summarizes the trend portion of quarterly sales of automatic dishwashers over a long cycle. Sales exhibit seasonal variations. F_t = 40 - 6.5t + 2t^2 where F_t = Unit sales (in 000 units) t = 1 at the first quarter of 2010 During the fourth quarter of 2014, the actual number of dishwashers sold was 800 (000 units). Compared to the seasonally adjusted forecast (refer to your assignment) for the fourth quarter of 2014, what is (how much) is the forecast error for the 4th quarter of 2014? (Express your answer in 000 units) Answer:

Explanation / Answer

Ft = 40 -6.5 *t +2t^2

4th quarter 2014 ,t = 20 as Q1 2010 , t= 1

F = 40 - 6.5* 2 0+ 2 *20^2 = 710

seasonal index = 130 %

hence

F = 710*1.3 = 923

error = 923 -800 = 123

123000 is correct answer

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