Cash forecasting models typically rely on regression analysis using historical data in order to generate predictions for
Question:
Cash forecasting models typically rely on regression analysis using historical data in order to generate predictions for future cash needs (for bank borrowing or short-term investment).Given the data set below showing inventory values (It) in tons and sales values (St) in millions of dollars over time (t), derive the intercept and slope parameters for the regression It = + St .Show all your work for full credit.
Once the regression has been estimated, show your result as an approximate scatter diagram of observed inventory values on observed sales values and then compute (using your estimated regression) the predicted number of tons of inventory if next year's sales value is forecasted to be 63 million.What is the percent of inventory variation explained by or associated with the variation in sales?