Prices, computer forecasting

Research indicates that several companies may dynamically adjust the price of their products over time. Indeed, dynamic pricing is a popular strategy in computer industry. Dell Computer Corp., which is the No. 1 PC maker in the world, is one of the pioneers in this area. By working with the company main suppliers, Dell can forecast prices for each component in its computers several... 

Semi-automatic software These are moderately priced but they require the user to have some basic knowledge of forecasting principles and fechniques. Here, fhe user has to select an appropriate forecasting technique based on the analysis of time series data. The software will then compute the optimal parameters for the chosen method using some measure of forecasf error. It also gives the forecasts and all the statistics, such as MAD, MAPE, MSE, Bias, etc. The software makes no recommendation as to which forecasting technique is appropriate for the given data. 

An area in which supercomputers have become indis-pensible is weather forecasting and research in climatology. The quality of weather forecasts has been increasing steadily with that of the numerical models that describe the motions of air, moisture, and driving forces such as sunshine and temperature differences. The price to be paid for these more refined models is the increased amount of computation to be done. In particular, for weather forecasting the timeliness of the results is of obvious importance, so for more intricate weather models, computers have to be faster to meet the time requirements. 

Forecasting prepayments is crucial to computing the cash flows of MBS. Though the underlying payment remains unchanged, prepayments, for a given price, reduce the yield on the MBS. There are a number of methods used to estimate prepayment two commonly used ones are the constant prepayment rate (CPR) and the PSA method. 

Technical analysis is also built on the belief that free market prices themselves embody all relevant and at iilable information on commodity fundamentals, and that they accurately reflect intangible factors such as expectations and mariret psychology. With the use of computer technology, technical analysis can generate price forecasts on a more or less continuous basis this makes the approach ideally suited to short-run analysis and the preferred choice of professional traders. 

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