Chapter 1 Itβs Not Just about Forecasting
The following are the key points in the chapter. Elaborate on each
point in at least 30 words.
- Understanding economics can help you to diagnose the causes of
increases or decreases in sales volumes and costs.
- Understanding the principles of economics will help you decypher
if the increase or decrease in sales volume and/or costs is inline with
current economic trends or if the changes are isolated to your
business
- Business decisions are about the future and must rely on a view of
the future.
- Businesses that do not plan for the future will not survive in
the long term, even if they are able to ride a bubble to short term
economic success.
- Economics can help you form a more accurate vision of the future,
compared to other common methods of forecasting.
- Economics give a much more accurate forecast than other methods
due to their ability to predict longer term trends than other methods.
This creates a much more accurate view of the future than other
methods.
- As a business manager, you should focus more on the broad magnitudes
of changes rather than specific numbers.
- When making long term forecasting decisions it is important to
present results in a broad magnitude of change rather than specific
numbers. This is due to economics not being an exact science with many
variable unaccounted for, meaning a broader approach to presenting the
data will lead to more room for error.