Final answer:
Creating statistical models that predict demand by using historical data is known as trend analysis. It is widely used to make informed decisions and to validate predictive models, and it is essential in determining parameters or statistics when analyzing population data. C. Benchmarking
Step-by-step explanation:
When referring to the creation of statistical models that predict demand for the next year using objective statistics from the previous year, we are discussing trend analysis. Trend analysis involves examining historical data to determine future outcomes, and it's used extensively in fields like economics, finance, and business to inform decisions and strategies. For example, an economist might derive a model to predict stock market outcomes by examining expected points on a stock market index and comparing them with actual points after each day's trading. This process helps in validating the accuracy of the prediction model.
Furthermore, if the U.S. federal government surveys all high school seniors about their future education and employment plans and finds that 50% plan to attend a four-year college or university, this percentage represents a parameter, which is the true value for the entire population. Contrarily, if only a sample is surveyed and 50% respond affirmatively, the value is a statistic, representing a portion of the population rather than the entirety.
To provide another perspective, statistical models can range from deterministic models used for precise predictions in engineering and physics to probabilistic models akin to those used for weather forecasts. These models showcase the vast range of applications for mathematics in developing tools that can predict future events or outcomes based on historical data.