IB MARKETING

Define sales forecasting.

• A qualitative guess of future sales.
• A quantitative technique used to predict expected sales revenue over a given period.
• A method to track historical sales only.
• A tool used solely for budgeting marketing expenses.

What is the primary purpose of sales forecasting?

• To set fixed production quotas.
• To help managers plan for HR, production, cash flow, and budgeting.
• To reduce marketing expenditures.
• To determine the legal structure of the business.

Which technique is commonly used in sales forecasting?

• SWOT analysis.
• Extrapolation using time series data.
• Break-even analysis.
• Qualitative interviews only.

Sales forecasting data is critical for:

• Determining corporate governance structures.
• Forming production schedules and managing inventory.
• Setting international trade policies.
• Establishing new regulatory guidelines.

One benefit of sales forecasting is that it:

• Guarantees future sales levels.
• Smooths out seasonal, cyclical, and random variations to identify trends.
• Eliminates the need for market research.
• Predicts competitor strategies exactly.

A key limitation of sales forecasting is that:

• It is 100% accurate over long periods.
• It is usually accurate only for short time periods.
• It requires no reliable data.
• It works equally well for all industries.

Sales forecasting techniques generally assume that:

• Future trends will mirror past trends.
• The past is irrelevant for future sales.
• Customer preferences change drastically every month.
• Economic conditions have no effect on sales.

Define seasonal variations in the context of sales forecasting.

• Irregular, unpredictable sales changes.
• Regular, predictable fluctuations in sales occurring at specific times of the year.
• Long-term growth trends.
• Permanent changes in market structure.

Seasonal variations are calculated by:

• Comparing actual sales data with the trend line.
• Averaging sales data without adjustments.
• Subtracting exports from imports.
• Only using qualitative feedback.

Which product is most likely to show seasonal variation?

• Smartphones year-round.
• Ice cream sales during summer.
• Office supplies.
• Durable goods with constant demand.