QUESTION TWO GM Motors of Lusaka produces electronic motors for power actuated values for block makers in Lusaka. The GM Motors has been in operational for a year now and Mr. Banda, the plant manager, thinks that the growth in sales will continue for the years to come. Mr. Banda wants to develop a long range forecast to be used to plan facility requirements for the next three years. The sales records for the past ten years have been accumulated; Years Annual Sale (K’000) 2007 1000 2008 1300 2009 1800 2010 2000 2011 2000 2012 2000 2013 2200 2014 2600 2015 2900 2016 3200 Required: a) Develop a regression equation for predicting the sales for the electronic motors. b) Use the regression equation to predict the sales for the next three year. c) Find the relationship between the sales and the years. Explain what your finding means.
QUESTION TWO
GM Motors of Lusaka produces electronic motors for power actuated values for block makers in Lusaka. The GM Motors has been in operational for a year now and Mr. Banda, the plant manager, thinks that the growth in sales will continue for the years to come. Mr. Banda wants to develop a long range
The sales records for the past ten years have been accumulated;
Years Annual Sale (K’000)
2007 1000
2008 1300
2009 1800
2010 2000
2011 2000
2012 2000
2013 2200
2014 2600
2015 2900
2016 3200
Required:
a) Develop a regression equation for predicting the sales for the electronic motors.
b) Use the regression equation to predict the sales for the next three year.
c) Find the relationship between the sales and the years. Explain what your finding means.
2. A firm uses simple exponential smoothing with a=0.1 to forecast demand. The forecast for the week of January 1 was 500 units whereas the actual demand turned out to be 450 units. Calculate the demand forecast for the week of January.
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