From Kaplan:
Shouldn’t T-1 = $900, not $1,000?
I assume that you mean salesT−1.
If so, yes.
If we set T = 2000.2, are we not calculating the sales estimate at (T+1) for 2000.3?
Within the Kaplan explanation, the formula has ($1,000 - $900), which is Sales sub T-1 minus Sales sub T-2.
Yet from the table T-1 = $900 & T-2 = $1,200
Why are the sales numbers different?
The subscripts in the formula are relative to t. If we call 2002.3 NewT, then T becomes the t -1 and T-3 becomes t-4 and T-4 becomes t-5.
I see, 2000.3 is the new T. Excellent, I applied your explanation to a new and similar question and it worked. Thank you!
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