Understanding Forecasting Methods
Forecasting methods are broadly categorized into two types:
- Qualitative Methods: Rely on subjective inputs like expert opinions, surveys, and intuition. Useful when historical data is scarce or irrelevant.
- Quantitative Methods: Utilize historical numerical data and statistical models to predict future outcomes.
Analysis of Forecasting Options
Let's analyze each option provided:
- Linear Regression: This is a quantitative technique that models the relationship between variables using a linear equation based on historical data.
- Weighted Moving Average: This is a quantitative method that calculates a forecast based on historical data points, assigning different weights to each point.
- Delphi: This is a qualitative forecasting technique that involves a structured process of gathering and consolidating judgments from a panel of experts through multiple rounds of questionnaires.
- Exponential Smoothing: This is a time-series forecasting method, a type of weighted average, making it a quantitative technique.
Identifying the Qualitative Method
Based on the analysis, the Delphi method is the only qualitative forecasting technique among the options. It relies on expert judgment rather than historical numerical data.
Important Questions from Forecasting
The correlation coefficient between two variables X and Y is found to be 0.6. All the observations on X and Y are transformed using the transformations U = 2 – 3X and V = 4Y + 1. The correlation coefficient between the transformed variables U and V will be
Which of the following lines is known as the trend line?
An XYZ television supplier found a demand of 200 sets in July, 225 sets in August and 245 sets in September. Find the demand forecast for the month for the month of October using simple average method.
Name the human resource demand (need) forecasting technique, which solicits estimates of personnel needs from a group of experts, usually managers. The HRP experts act as intermediaries, summarise the various responses and report the findings back to the experts. The experts are surveyed again after they receive this feedback. Summaries and surveys are repeated until the experts' opinions begin to agree. The agreement reached is the forecast of the personnel needs.
Select the correct option :
Which of the following is a technique used for forecasting?
