DQ 1

Managerial decision-making is forward-looking and predictive.

Predictive power suggests certain results. Whether building a stock model intended to predict stock price or a business decision model, economic models are more an art than a science.

Provide examples of different Excel-type models used by companies to make economic-type decisions.

DQ 2

Regression analysis is a tool for building statistical models that characterize relationships among a dependent variable [sales, for example] and one or more independent variables [price, for example].

Find real world data, perhaps from a companys annual report or from government sources, then use Excel to develop a simple or multiple regression analysis with a dependent and an independent variable.

Describe, explain, discuss, and comment on the regressions predictive, strategic value.

Attach your spreadsheet.

RESPOND TO THIS ONE BELOW

DQ 1

A companys success depends on the ability of its leaders ability to make wise economic decisions. It is vital that the decision making process relies heavily on the companys financial reports and the decision makers should have a clear understanding of the companys economic environment. The excel-type of economic models are one of the models that help decision makers and economists evaluate the economic decision-making process (Ingram, 2016). For instance, excel-type of models may consist of one or more input parameters along with data and formulas used to perform calculations, interpretation of results and decision making (Chartered Institute of Management Accountants, 2012). In the Automated Concepts Inc. excel model attached, the model provides an analysis of the financial inputs, labour savings, production increase, a summary of investment and savings, and a financial analysis of cash flow, all of which are crucial for managers in evaluating the economic performance of the company (Evans, 2015). Also, by changing values of the input parameters in excel, you can do the what-if studies to observe what happens when the inputs change (Chartered Institute of Management Accountants, 2012).

References

Chartered Institute of Management Accountants. (2012). Efficient decision making with excel forecasting models. Retrieved from http://www.cimaglobal.com/Thought-leadership/Newsletters/Insight-e-magazine/Insight-2012/Insight-May-2012/Efficient-decision-making-with-Excel-forecasting-models/ (Links to an external site.)

Evans, Matt. (2015). Excel spreadsheets. Retrieved from http://www.exinfm.com/free_spreadsheets.html (Links to an external site.)

Ingram, David. (2016). Making business decisions: Basic factors of economic decision making. Retrieved fromhttp://smallbusiness.chron.com/basic-factors-economic-decision-making-3944.html (Links to an external site.)

Economic evaluation - Automated Concepts Inc..xls