Case study: Bank Account Forecast A well-known commercial bank in Australia is interested in estimating the...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Case study: Bank Account Forecast A well-known commercial bank in Australia is interested in estimating the number of new bank account opened by customers in each year. The number of new accounts opened in this bank has increased slowly over years even during the global financial crisis (20082009). Top management strongly believes that they need a long-term strategic plan for the bank which is a 5-year forecast for the number of new accounts opened. To achieve this aim, the bank operations manager examined past account data and also extracted the employment rate over 30 years (1991-2020). The resulting data are shown in below table: No of new Year account(000) Employment No of new Rate (%) Year account(000) Employment Rate (%) 1991 3.136 90.42 2006 6.007 95.22 1992 3.309 89.27 2007 5.826 95.62 |1993 3.803 89.13 2008 8.266 95.77 1994 6.807 90.28 2009 7.128 94.44 1995 2.386 91.53 2010 9.670 94.79 1996 4.643 91.49 2011 11.419 94.92 1997 2.911 91.64 2012 11.335 94.78 1998 2.553 92.32 2013 9.358 94.34 1999 4.422 93.13 2014 10.418 93.92 2000 3.613 93.72 2015 10.459 93.95 2001 3.948 93.26 2016 7.328 94.29 2002 3.347 93.63 2017 9.004 94.41 2003 3.907 94.07 2018 8.559 94.70 2004 4.071 94.60 2019 8.476 94.84 2005 6.666 94.97 2020 8.635 93.39 a. Using the following forecast methods discuss which method fits best for the bank strategic plan. You need to justify the selection of one method over another. 1. Moving average (you need to find the best value for n) 2. Linear trend (trend projection) 3. Linear regression b. Can you exclude a portion of the data for the analysis? If yes, why? The bank operations manager also collected the data on Australia GDP Per Capita (Gross Domestic Product) and believes that GDP Per Capita can also affect the number of bank account. Below table shows the data for the same period: GDP Per Capita GDP Per Capita Year (000AS) Year (000AS) 1991 18.8218 2006 36.04492 1992 18.57012 2007 40.96005 1993 17.63453 2008 49.60166 1994 18.04614 2009 42.77236 1995 20.31963 2010 52.02213 1996 21.86133 2011 62.51783 1997 23.4686 2012 68.01215 1998 21.31896 2013 68.15011 1999 20.53304 2014 62.51079 2000 21.67925 2015 56.75572 2001 19.49086 2016 49.97113 2002 20.08248 2017 54.02797 2003 23.44703 2018 57.35496 2004 30.43068 2019 55.0572 2005 33.99924 2020 51.81215 c. Between GDP Per Capita and employment rate which one do you think can better estimate the number of new bank account? Marking criteria: Criterion Marks Correct forecasts for all possible periods using Moving average. Show the graph of actual and forecast. 3 Correct forecasts for all possible periods using Linear trend (trend projection). Show the graph of actual and forecast. 3 Correct forecasts for all possible periods using Linear regression. Show the graph of actual and forecast. 3 Find the method that fits best for the bank strategic plan. Explain why? Whether we can exclude a portion of the data for the analysis? If yes, why? 4 3 Explain which variable, GDP Per Capita or employment rate, can better estimate the number of new bank account and why? 4 Total 20 Important information for Assignment 1: Please submit just one file. Your submission must be in Microsoft Word. You can copy and paste screenshots from Excel into the Word document. Brief explanation is required for all calculations. Do not round the results up or down. Case study: Bank Account Forecast A well-known commercial bank in Australia is interested in estimating the number of new bank account opened by customers in each year. The number of new accounts opened in this bank has increased slowly over years even during the global financial crisis (20082009). Top management strongly believes that they need a long-term strategic plan for the bank which is a 5-year forecast for the number of new accounts opened. To achieve this aim, the bank operations manager examined past account data and also extracted the employment rate over 30 years (1991-2020). The resulting data are shown in below table: No of new Year account(000) Employment No of new Rate (%) Year account(000) Employment Rate (%) 1991 3.136 90.42 2006 6.007 95.22 1992 3.309 89.27 2007 5.826 95.62 |1993 3.803 89.13 2008 8.266 95.77 1994 6.807 90.28 2009 7.128 94.44 1995 2.386 91.53 2010 9.670 94.79 1996 4.643 91.49 2011 11.419 94.92 1997 2.911 91.64 2012 11.335 94.78 1998 2.553 92.32 2013 9.358 94.34 1999 4.422 93.13 2014 10.418 93.92 2000 3.613 93.72 2015 10.459 93.95 2001 3.948 93.26 2016 7.328 94.29 2002 3.347 93.63 2017 9.004 94.41 2003 3.907 94.07 2018 8.559 94.70 2004 4.071 94.60 2019 8.476 94.84 2005 6.666 94.97 2020 8.635 93.39 a. Using the following forecast methods discuss which method fits best for the bank strategic plan. You need to justify the selection of one method over another. 1. Moving average (you need to find the best value for n) 2. Linear trend (trend projection) 3. Linear regression b. Can you exclude a portion of the data for the analysis? If yes, why? The bank operations manager also collected the data on Australia GDP Per Capita (Gross Domestic Product) and believes that GDP Per Capita can also affect the number of bank account. Below table shows the data for the same period: GDP Per Capita GDP Per Capita Year (000AS) Year (000AS) 1991 18.8218 2006 36.04492 1992 18.57012 2007 40.96005 1993 17.63453 2008 49.60166 1994 18.04614 2009 42.77236 1995 20.31963 2010 52.02213 1996 21.86133 2011 62.51783 1997 23.4686 2012 68.01215 1998 21.31896 2013 68.15011 1999 20.53304 2014 62.51079 2000 21.67925 2015 56.75572 2001 19.49086 2016 49.97113 2002 20.08248 2017 54.02797 2003 23.44703 2018 57.35496 2004 30.43068 2019 55.0572 2005 33.99924 2020 51.81215 c. Between GDP Per Capita and employment rate which one do you think can better estimate the number of new bank account? Marking criteria: Criterion Marks Correct forecasts for all possible periods using Moving average. Show the graph of actual and forecast. 3 Correct forecasts for all possible periods using Linear trend (trend projection). Show the graph of actual and forecast. 3 Correct forecasts for all possible periods using Linear regression. Show the graph of actual and forecast. 3 Find the method that fits best for the bank strategic plan. Explain why? Whether we can exclude a portion of the data for the analysis? If yes, why? 4 3 Explain which variable, GDP Per Capita or employment rate, can better estimate the number of new bank account and why? 4 Total 20 Important information for Assignment 1: Please submit just one file. Your submission must be in Microsoft Word. You can copy and paste screenshots from Excel into the Word document. Brief explanation is required for all calculations. Do not round the results up or down.
Expert Answer:
Posted Date:
Students also viewed these general management questions
-
Shreya commutes in a CNG fitted van to school every day along with many other students. She told the van driver to get the CNG connection certified and timely checked it for any leakage or loose...
-
Suppose that the Saddledome, the home of the Calgary Flames, earns total revenue that averages $28 for every ticket sold. Assume that annual fixed expenses are $22 million, and that variable expenses...
-
X-Run Inc. uses the installment-sales method in accounting for its installment sales. On January 1, 2014, X-Run had an installment account receivable from Herman Pringle with a balance of $3,900....
-
Describe the advantages of the contribution approach over absorption costing methods in evaluating decision alternatives.
-
Chris Titera is the chief financial officer (CFO) for Dallas Company. It is January 10, and Chris has just finished compiling the preliminary financial results for the most recent fiscal year, which...
-
Bertans Company sells its product for $55 per unit. Variable costs are $25 per unit. Total fixed costs are $11,200. In order to reach their profit goal of $14,100, Bertans must have how much total...
-
Suzuki Limited uses a combination of shares and debt in their capital structure. The details are given below: There are 7 million ordinary shares in issue with a par value of R2.20 each and the...
-
Prepare in columnar form for the head office. Thika branch and the combined business. The income statements for the year ended 30 September 2004. (12 marks)
-
Discuss the successes of and obstacles to the single market. in particular, focus on a) How important is the single market in promoting competitiveness and growth? and b) to what extent is the single...
-
On June 16, 2009, llano Co. sold merchandise to PascualCo. for 6k terms 2/10, n/30. Shipping costs were 600. Pascual Co, received the goods and llano Co.'s invoice on June 17. On June 24, Pascual Co....
-
Consider the following figure. (The four charges are at the corners of a square. Take q = 1.09 C and Q = 2.09 C.) 9=Q 9=9 94-Q 10.0 cm 93=-9 (a) In the figure, what are the magnitude and direction of...
-
Name: Address Class Identification Address 10.250.1.1 150.10.15.0 192.14.2.0 148.17.9.1 193.42.1.1 126.8.156.0 220.200.23.1 230.230.45.58 177.100.18.4 119.18.45.0 249.240.80.78 199.155.77.56...
-
During the year Juda issued a $ 5 comma 000 note payable. Juda acquired equipment worth $ 23 comma 000, and made payments on the long-term notes payable in the amount of $ 7 comma 000 during the...
-
Revol Industries manufactures plastic bottles for the food industry. On average, Revol pays $76 per ton for its plastics. Revol's waste-disposal company has increased its waste-disposal charge to $57...
-
From an audit perspective, which of the following statements about the design phase of the program development life cycle is true? a. Program documentation provides little evidence about the quality...
-
Which of the following is a disadvantage of a bottom-up module implementation and integration strategy? a. Low-level modules that perform critical input-output functions are not tested first b. The...
-
Which of the following is not an allowable control structure in structured programming? a. Conditional repetition b. Unconditional branch c. Simple sequence d. Selection based on a test
Study smarter with the SolutionInn App