# SMU MBA ASSIGNMENTS

## 3 Production for last 7 years of XYZ ltd is given in following table

December 02, 2017 By: Meliza Category: 1st SEM

3 Production for last 7 years of XYZ ltd is given in following table

 Year 2009 2010 2011 2012 2013 2014 2015 Production(in Tons) 8 12 13 17 25 22 30

Based on above data forecast the production for year 2016 & 2017.

A Fitting of straight line

Production for year 2016

Production for year 2017

Answer:  The trend line can be fitted by using the method of least squares for the given data.

 Year Production y X= Year – 2012 XY X^2 2009 8 -3 -24 9 2010 12 -2 -24 4 2011 13 -1 -13 1 2012 17 0 0 0 2013 25 1 25 1 2014 22 2 44 4 2015 30 3 90 9 127 0 98 28

When å X = 0, then normal equations reduce to:

åY = Na , therefore,

a = SY/N

= 127/7

= 18.14

å XY = bå X^2 , therefore,  b = S XY/ SX

= 98/28

= 3.5

The estimated equation of the trend line is given by

Y = a + bX =18.14 + 3.5 X

for     2016, X =  4

Y         =       18.14 + (3.5 *4)

=       79.65 – 7.44

=       32.14

Hence the price for 2016  is Rs 32.14

for     2017, X =  5

Y         =       18.14 + (3.5 * 5)

=       79.65 – 7.44

=       35.64

Hence the price for 2017 is Rs 35.64