ACCA MA Syllabus B. Data Analysis And Statistical Techniques - Time Series Analysis - Notes ^{10 / 12}

it is useful when forecasting data which has a regular seasonal pattern as may be the case with sales of certain products

it is a rather simplistic approach

it assumes that past trends will continue indefinitely and that extrapolating data based on historic information will give valid conclusions.

In reality, the sales of products may be influenced by the actions of competitors, particularly in relation to new products becoming available on the market.