pease (as _CASE PROBLEM 12.3. Beijing Specialty Noodle Export Business ‘The global economic crisis started in 2008 and has had a dramatic impact on Belling Specialty Noodle Export Busi- ness. The worls's leading economists are not in atign- ‘ment on what the coming year will look like. Some ‘economists are predicting a “double dip scenario where the economy takes another major drop. Other economists are predicting @ very small global economy growth of about 1% A very small set of experts are predicting that the economy is at its turning point and that the global ‘economy will expand by at Least 3% next year Beljing Specialty Noodle’s export experience shows ‘that their export business is tied very closely to what is happening in the global economy. When the economy is, ‘growing, their exports grow as well The firm's leadership wants to forecast what their ex- port business will be next year. Unfortunately the leading economic experts are not presenting a universal agree- ‘ment on what to expect. The company’s forecasting ability is also complicated as they have never tived through 2 global economic meltdown before and the duration ofthis ‘experience is just three years. Thus, while they have a large data set of past performance, the time frame for the economic meltdown is very small. Beljing Specialty Noodle has contracted with you to build them a forecast for next year's exports. It is their view that the likelihood of a “double-dip” situation is very small, While some economists are stating this could hap- pen, the majority of economists are predicting 2 global growth of 1-3%, They have provided you the following 15 years of Years 12-16 are those where the global economic ‘Yb forecast.Chapter 12+ Forecasting 881 Year tial, adjusted exponential, and linear forecast models | 5 1 ma ‘and provide a year 16 forecast for each model, based on 2 t w "2 year 15 sales. In other wards, they want you to exclude 3 a " wy years 13 and 14 from the forecast model and assume 4 6 a that year 15 is year 13. 5 9 3 68 Identify at least one item that supports the use of any & 1 “ 65 ‘model over the others. 7 0 % “8 ‘What is the risk of ignoring years 13 and 142 8 Ne