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Hello Dear John,
I already asked my question is this topic (https://opentuition.com/topic/forecasting-12/), but unfortunately it is closed now and I have to open a new topic. sorry
I already had watched your great lectures on this topic and I know what is the trend. I think my question was not clear.
according to the question we have to calculate the trend:
The trend is : 4,700 / 0.92 = 5,109. This is the final answer. I am completely OK with this calculation. No problem at all.But my question here is so if the trend is 5,109, then why the question is stating on the text of the question that the underlying trend is 4,300 ?!!!! we calculate the trend and it was 5,109 which is also the correct answer.So what is this 4,300!!!
Hope I am more clear now.
Thank you very much
The underlying trend is what would happen if there were not seasonal variations – the averages.
However there are other reasons for the actual values varying, and what the 4,700/0.92 is, is taking what actually happened, removing the seasonal variation, and so seeing what the figure would be if there was no seasonality.
Thank you.
Sorry but I think I am a little confused yet 🙁I read your reply few times. What I get from your reply is:
4700/0.92 is in fact the trend , removing ONLY the seasonal variation.
and
the 4300 (the underlying trend) is the trend , removing ALL variations not just seasonal variationIs it correct?
Thank you
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