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Abstract

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The purpose of this paper is to study the effects of errors in the sales forecast on inventory changes and production rates. This is done by computing the ratio of the standard deviation of inventory change or production rate to the standard deviation of sales rate. By use of this ratio the effects of the average forecast error, the variance of the forecast error, and the serial correlation of sales can be studied. Both analytical method and simulation procedures are used.

Details

10000008
Subject
Production planning;
Sales forecasting;
Inventory;
Standard deviation;
Simulation;
Random variables;
Probability distribution;
Expected values
Business indexing term
Title
SALES FORECASTING ERRORS AND INVENTORY FLUCTUTIONS: RANDOM ERRORS AND RANDOM SALES
Author
Thompson, Howard E
Publication title
Management Science (pre-1986); Linthicum
Volume
12
Issue
5
Pages
448
Number of pages
9
Publication year
1966
Publication date
Jan 1966
Publisher
Institute for Operations Research and the Management Sciences
Place of publication
Linthicum
Country of publication
United States
Publication subject
Business And Economics--Labor And Industrial Relations
ISSN
00251909
e-ISSN
15265501
CODEN
MNSCDI
Source type
Scholarly Journal
Language of publication
English; EN
Document type
statistics
ProQuest document ID
205828495
Document URL
https://www.proquest.com/scholarly-journals/sales-forecasting-errors-inventory-fluctutions/docview/205828495/se-2?accountid=208611
Copyright
Copyright Institute for Operations Research and the Management Sciences Jan 1966
Last updated
2024-11-23
Database
ProQuest One Academic