Suppose that a company's annual sales were $1,200,000 in 1999. the annual growth rate of sales from 1999 to 2000 was 16 percent, from 2000 to 2001 it was ? 5 percent, and from 2001 to 2002 it was 22 percent. the geometric mean growth rate of sales over this three-year period is calculated as 10.37 percent. use the geometric mean growth rate and determine the forecasted sales for 2004.

$ 1,965,334

Step-by-step explanation:

Annual sales of company in 1999 = $ 1,200,000

Geometric mean growth rate = 10.37 % = 0.1037

In order to forecast we have to use the concept of Geometric sequence. The annual sales of company in 1999 constitute the first term of the sequence, so:

The growth rate is 10.37% more, this means compared to previous year the growth factor will be

r =1 + 0.1037 = 1.1037

We have to forecast the sales in 2004 which will be the 6th term of the sequence with 1999 being the first term. The general formula for n-th term of the sequence is given as:

So, for 6th term or the year 2004, the forecast will be:

Thus, the forecasted sales for 2004 are $ 1,965,334

(0.2)+(-8)=0.3+-3+0.3m is the equation i guess? ?

step-by-step explanation:

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