Question

Microsoft Excel was used to obtain the following quadratic trend equation: Sales = 100 - 10X + 15X2. The data used was from 2004 through 2013 coded 0 to 9. What is the forecast for 2012?

Answer 1

The forecast for 2012 was 980.

Explanation:

1. Calculate.

From 2004 to 2013 there are 10 years, if we include the initial year. Hence, 2013 must be year 9. Therefore, 2012 must be year 8 (check the attached image to get a better understanding of this logic, in case it's needed). With this information, take the value of 8, substitute it by x in the formula and calculate:

`Sales(8) = 100 - 10x + 15x^(2) \\ \\Sales(8) = 100 - 10(8) + 15(8)^(2)\\ \\Sales(8) =980`

2. Conclude.

The forecast for 2012 was 980.