Prerequisite: Finance 323.
Business fluctuations; forecasting, and related problems confronting the business firm; forecasting techniques; specific
forecasts. The use of forecasts in the firm.
The prerequiste is strictly enforced.
Almost every business endeavor requires some sort of forecast. Forecasts are an essential part of making decision. Results of a business decision are usually not known as the decision is being made, since decisions can only be made about events in the future, not events that have already happen. Even though forecasts are constantly needed most of
us are very uncomfortable with the thought of forecasting.
Even though we may be uncomfortable with forecasting we are all pretty good forecasters. Why?
Because we have managed to survive to this point. Every day decisions in life also require that we forecast. Finding food, clothing, and shelter requires we all make decisions about our actions
and these decisions are based on fo
recasts. If you were really terrible at forecasting you probably wouldn't be reading this.
Complete Course Syllabus
So if we all have done forecasting, and in reality are pretty good at it then what's the purpose of this course? We all recognize that if we could
improve our forecasts, perhaps only marginally we would be better decision makers. This is very apparent in those uncomfortable situations where we are questioned as to our
"assumptions," which frequently are really forecasts of future events. How much better would our decisions be if we felt more secure about our ability to predict outcomes?
The premise of this course is not that we are going to become prefect prognosticators, but that
with practice we can become better at forecasting. This margin of improvement may just the be the difference between being a labelled a successful decision maker and being labeled as unsuccessful.
We are going to spend the semester looking at various forecasting techniques. Hopefully when
you have completed this course you will be able to evaluate various forecasts and the techniques used to generate them; be able to implement new forecasting techniques; and be able to
communicate your forecasts to others.
My personal observations are that you will be more successful at learning new forecasting
techniques if you are actively involved in solving problems. The exercises in this class are designed to have you become involved in finding, evaluating and applying forecasting techniques.
An assumption of this class is that people involved in forecasting have access to computers.
While there is a variety of software available to aid in forecasting most computers do not have this type of software. In fact it is fairly expensive. So we are going to use as much standard
software as we can, particularly a spreadsheet.
Unfortunately, certain types of forecasting techniques are relatively difficult to implement in a
spreadsheet and we will use some specialized software in those cases. It might also be helpful to have access to a statistics package.
When you have completed this course you should have a good understanding and be able to use the most popular techniques currently available.
Finally, good forecasting requires that you have an understanding of your environment, both in
terms of specifics and generalities. So please keep current about general business conditions.