Definition
An estimate of future financial outcomes based on historical data and trends, used for planning and budgeting.
What to consider
- Use forecasts to anticipate future income and expenses.
- Adjust your budget based on projected trends and changes.
- Regularly update your forecasts to stay on track.
Real world scenarios
- Before launching the new product line, the startup prepared a financial forecast to predict future revenues and costs, guiding their budgeting decisions.
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