Assignment: Predictive Modeling
Introduction and Purpose of Assignment
Predictive modeling is the use of predictors that have been determined to influence future outcomes in order to create a statistical model. There is no one form of predictive modeling. It can be simple - using a linear equation - or more complex using sophisticated software.
Objectives
• Apply predictive modeling to an organizational question.
Theory and Context
Predictive analytics involves using information from historical data to identify patterns in order to determine possibilities for the future. Regression and trend analyses are both examples of predictive analytics.
Resources
The Corporate Genie. (2014, March 20). What is predictive analytics data mining [Youtube Video file]?
Kutukcuoglu, T. A. (2012, March 8). Predictive modeling with linear regression - 1.
Queensland Government. (1995-2007). Trend analysis for business improvement.
wikiHow to do trend analysis in Excel. (n.d.).
Instructions
1. Assume that for a given company, net profit will increase when sales increase. In this scenario, the linear relationship exists between sales (the independent variable) and net profit (the dependent variable).
2. Develop a trend and linear regression analysis for a public company of your choice.
a. Map the past 10 years of sales and net profit data.
b. Predict future values for the next two years for the dependent variable (net profit).
i. The website "Introducing Predictive Marketing: The Next Stage of Business Optimization"above provides information on the calculations.
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.