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Forecasting
Seasonality
Regular within-year patterns — a December peak, a summer trough — that repeat every year and should be forecast, not explained away as variance.
Owned by: AnalystTest band: Analyst
In practice
Build monthly seasonality indexes from two or three years of history and apply them to the annual number. A flat monthly forecast of a seasonal business is wrong eleven months a year.
The kind of thing the test asks
- Sales are strongest in December every year. The right way to forecast is…
More in forecasting
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