Which forecasting method uses historical data to predict future demand?

Which forecasting method uses historical data to predict future demand?

• A. Time-series analysis.
• B. Judgmental forecasting.
• C. Delphi method.
• D. Market research surveys.

Answer: (A)

Time-series analysis forecasts future demand by analyzing historical data for patterns such as trends and seasonality. It looks at how demand has moved over time and uses that sequence of data to project what will happen next, often with models that capture periodicity and changes in the level over time. This approach relies on the actual history of demand, rather than opinions or surveys, to make predictions. Judgmental forecasting, on the other hand, depends on experts’ opinions rather than numeric history. The Delphi method gathers structured expert judgments through iterative rounds to reach agreement. Market research surveys collect current customer opinions or intentions, which reflect present attitudes rather than long-run historical patterns.

Time-series analysis forecasts future demand by analyzing historical data for patterns such as trends and seasonality. It looks at how demand has moved over time and uses that sequence of data to project what will happen next, often with models that capture periodicity and changes in the level over time. This approach relies on the actual history of demand, rather than opinions or surveys, to make predictions. Judgmental forecasting, on the other hand, depends on experts’ opinions rather than numeric history. The Delphi method gathers structured expert judgments through iterative rounds to reach agreement. Market research surveys collect current customer opinions or intentions, which reflect present attitudes rather than long-run historical patterns.