Suppose That You Are Using the Naïve Forecasting Method with Trend

question 66

Multiple Choice

Suppose that you are using the naïve forecasting method with trend to forecast sales. If sales have been declining by 20% per week, and this week's sales amounted to $200, what would your forecast be for next week?

• A) $200
• B) $ 40
• C) $240
• D) $180
• E) $160

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Definitions:

Market-to-Book Ratio

A financial ratio that compares a company's market value to its book value, indicating how investors value the company compared to its actual worth.

Price-Earnings Ratio

A valuation ratio of a company's current share price compared to its per-share earnings, used to determine if the stock is over or under-valued.

Book Value Per Share

The shareholder equity available per outstanding share of a company, calculated by dividing total equity by the number of shares outstanding.

Statement of Comprehensive Income

A financial report that includes not only net income, but also other forms of comprehensive income such as unrealized gains or losses on investments.