Forecasting

You are skeptical of this Vice President’s claim and assume he simply guesses which products will improve or worsen in price over any given month. Put another way, you assume he has a 50% chance of being correct in his prediction for any given product.  Based on this assumption, you derive the following probabilities concerning his ten picks:

Number of Correct Picks

0

1

2

3

4

5

6

7

8

9

10

Probability

0.001

0.01

0.044

0.117

0.205

0.246

0.205

0.117

0.044

0.01

0.001

Provide your analysis toward the following questions:

  1. What is your conclusion resulting from your reasoning? Outline the inductive and deductive reasoning you could use to evaluate whether or not the Vice President is simply guessing in his product sales picks.
  2. Construct a recommendation as to whether you recommend the organization continues using the Vice President’s current method of forecasting sales, or if the organization should use a different method.
  3. How would you recommend the organization use this methodology in the context of predictive analytics in the future?

Submission Requirements:

  • This assignment should be at least 500 words in length.
  • Submit as a Microsoft Word document attachment.

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