Business 620 Critical Thinking Three Salvatore ’ s Chapter 6 : Discussion Questions : 1 , 7 , and 15 . Problems : 7 and appendix problems 1 and 3 ( pp . 256 – 257 ). Salvatore ’ s Chapter 7 : Discussion Questions : 3 , 11 , and 12 . Problems : 4 , 12 , and 13 . Discussion Question 1 :
a ) What is forecasting ? Why is it so important in the management of business firms and other enterprises ?
b ) What are the different types of forecasting ?
c ) How can the firm determine the most suitable forecasting method to use ?
Discussion Question 7 : a ) Which type of smoothing technique is generally better ?
b ) How do we determine which of two smoothing techniques is better ?
c ) How can we forecast the values of a time series that contains a secular trend as well as strong seasonal and random variations ?
Discussion Question 15 : Explain why it is still useful to pursue forecasting even though it is often off the market by wide margins
Problem 7 : The following table represents data on three leading indicators for a three-month period . Construct the composite index ( with each indicator assigned equal weight ) and the diffusion index .