Zeta Stores Places Orders for 60% of the Sales Forecast

question 3

Multiple Choice

Zeta Stores places orders for 60% of the sales forecast in the next month and for 40% of the sales forecast for the following month.It pays for these goods with a 1-month delay? If sales for August are forecast at $10 million and sales for September and October are forecast at $12 million,what will be the forecast cash outflow in September?

• A) $10.8 million
• B) $15.6 million
• C) $4.8 million
• D) $9.6 million

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Definitions:

Prediction Interval

An interval estimate of a real-valued observation based on a sample of data predicting where an individual measurement will fall.

Particular Value

A specific or distinct value within a set or range of data.

Simple Linear Regression

A statistical method for modeling the relationship between a single independent variable and a single dependent variable, assuming a linear relationship.

Residuals

The differences between observed values and the values predicted by a statistical model, indicating the model's accuracy.