Below are four basic principles of forecasting:
1. Forecasts are rarely perfect
2. Short-term forecasts are usually better than long term forecasts
3. Aggregate forecasts (group) are usually more accurate that disaggregate (individual item) forecasts
4. The further up a supply chain a company is (farther from the end customer), the greater the distortion of information.
Briefly explain what is meant by each principle. How does understanding these principles help improve forecasting?