The project is to generate a sales forecast for a selected industry or multi-national firm using econometric methods. Sales data should be collected from available sources of Compustat, the Bloomberg system, or Statista. In addition, you must gather information on relevant measures of prices, income, advertising data, and other relevant (socio-economic) data to support the construction of a multi-variate regression model. You must build the econometric model utilizing a software of your choice.
Results of the analysis must include (a) an executive summary of the outcomes; (b) information supporting the choice of the variables, including the socio-economic variables (model specification), (c) interpretation of the elasticities and the implication to pricing strategy; and (d) interpretation of the results with implications to business policy. Finally, the students must address limitations to their model and potential changes that would improve its performance.
For the purpose of assurance of learning, four scores will be provided. The basis for these scores are the ability to (a) provide a justification, including ethical considerations, for the model specification based on relevant theory and gather the appropriate data (MBA- 2M); (b) use Excel or other software to generate forecasted demand outcomes (MBA-1M); (c) discuss the relevant economic implications of the estimated elasticities (MBA-ECON); and (d) suggest meaningful implications that inform business policy of a multi-national firm (MBA-MGMT).