Decision making techniques 3.3

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Extrapolation

Back

When the trend line is extended to forecast future sales.

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Four period moving average

Back

The average figure based on four time periods (often quarters of a year). It 'moves with time' and is usually calculated using centring, based on an 8 period total.

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Line of best fit

Back

A line that goes roughly through the middle of all the scatter points on a graph.

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Moving averages

Back

A succession of averages derived from successive segments of a series of values.

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Quantitative sales forecasting

Back

Involves making future predictions based on trends identified from past data, such as time-series analysis.

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Scatter graphs

Back

A graph showing the performance of one variable against another independent variable on a variety of occasions.

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Three period moving average

Back

An average calculated by adding 3 periods up and dividing by 3.

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Average (Accounting) Rate of Return

Back

A method of investment appraisal that measures the net return per annum as a percentage of the initial spending.

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Discounted Cash flow (Net present value only)

Back

A method of investment appraisal that takes interest rates into account by calculating the present value, discounted according to the interest foregone.

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Investment appraisal

Back

The evaluation of an investment project to determine whether or not it is likely to be worthwhile.