Compute the loss for Kwik Lube stations during the last two years using trend analysis. How accurate can results claim to be?
With a -.01 bias and a negligible tracking symbol, the forecast analysis substantiates Dick Johnson’s assertion that the presence of competition cut directly into Kwik Lube’s profit. A trend analysis was conducted and projects sales in the amount of $1,419,445 and $1,530,445 for 2006 and 2007, respectively. Comparing the gross sales forecast to actual sales, this results in a loss of $309,445 in 2006 and $420,445 in 2007.
Now, use the data in Table 1 and regression analysis, to compute the loss for Kwik Lube stations during the last two years. How accurate can results claim to be?
|(untitled) Summary |
|Measure |Value |
|Error Measures | |
|Bias (Mean Error) |0 |
|MAD (Mean Absolute Deviation) |29611.49 |
|MSE (Mean Squared Error) |1284291000 |
|Standard Error (denom=n-2-0=6) |41381.01 |
|MAPE (Mean Absolute Percent Error) |.03 |
|Regression line | |
|Dpndnt var, Y = 89527.02 | |
|+ 2.78 * X1 | |
|Statistics | |
|Correlation coefficient |.99 |
|Coefficient of determination (r^2) |.97 |
Was it worth $30,000 to perform the marketing research that obtained the data in Table 1?
If you were trying to determine if the return on the investment of $30,000 was worth the monetary loss alone, the answer is no. However, the information validates the statistical model based solely on the owner's franchise's data. This purchased data and