What are different methods of forecasting

The following are some important methods of forecasting-

(i) Extrapolation-Extrapolation is one of the simplest and important method of forecasting.It is depended upon the reasonable,expectation that the variable will follow its already established paths.Extrapolation let the variable will follow its established pattern of growth.Therefore the main aim is to determine accurately the appropriate trend curve and the value of its parameter.

(ii) Business Barometer-This is basically an indicator of present economic conditions ans is applied to as indicator of future condition.It general index refers to the general condition of business and trade .This index takes into account,industrial production,the general product,stock prices,etc.

(iii) opinion Polling-To make business forecast,opinion poll is one of way,opinion poll is basically a survey of opinion of experts in their field,sets representative,like whole salers etc.,to formulate the forecasting.

(iv) Casual Models-In forecasting,a casual model is the most sophisticated kind.It expresses mathematically the relevant casual relationship and may include inventories and market survey.

(v) Survey Method- For forecasting,survey method is one of the most widely used tool.By means of survey method,all types of qualitative and quantitative information are collected.

It can be emphasized here that whatever be the method of forecasting applied.By the judgement,of individuals who are familiar,with upheavals of business,it is essential that the forecast must be checked.By combining with statistical forecasting the judgement and knowledge of current business trends,more successful forecasting will result.

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