In this post, you’ll learn about* the FORECAST Function, its syntax and the way of using the FORECAST Function in an **excel* spreadsheet.

**FORECAST –** refers to the calculation or estimation of **future** happenings.

## What is FORECAST Function?

FORECAST Function is a statistical function. **FORECAST Function** calculates **future value**s based on existing values using the **linear regression**. It can also predict numeric values like sales, inventory, expenses, measurements etc.

In financial modeling, the FORECAST Function calculates **statistical values**.

Remark:

At the starting of excel 2016, the FORECAST Function replaced into FORECAST.LINEAR Function.

### Syntax

=FORECAST(x, known_y’s, known_x’s)

### Argument:

**= –**built-in function.**FORECAST() –**function name.**x –**x is a numeric value for which you want to find a new y-value.**known_y’s –**it is a range of data(dependent array y-value).**known_x’s –**it is a range of data(independent array x-value).

FORECAST Function calculates the relationship between a dependent variable(y value) and an independent variable(x value) also returns a predicted value based on linear regression between x and y value.

### Note:

**#VALUE! Error**– if x is not a numeric value.**#N/A Error**– if known_y’s and known_x’s are not with the same size and also if the cell is empty.**#DIV/0! Error**– if the value or variance of known_x’s is zero.

## How to use the FORECAST Function in Excel?

**FORECAST Function** calculates the prediction of future value using the existing values.

#### Example:

The FORECAST Function calculates a new y-value by using a **straight line equation**;

where;

__Step 1:__

Open the workbook in your Microsoft Excel.

__Step 2:__

Enter the data, in the workbook.

In this example, **periods** refers to the **month** and the **sales amount** according to the month.

__STEP 3:__

In the new cell or the cell where you want to calculate the value, give the formula or the syntax. Start with ‘ =’ for every functions, FORECAST to initiate functions name, followed by an open parenthesis.

Now we are going to calculate the future value that is the 8th-month FORECAST value. The** x value** is **8th period** which is placed in cell **B10**.

##### STEP 4:

After calculating keep a comma, then continue with the arguments of the syntax. Next argument is to calculate **known_y’s**.

**known_y’s** (dependent array) which is the sales amount, you can give the known values. Therefore, the values are from **C3:C9**.

##### STEP 5:

After calculating known_y’s keep a comma, then continue with the arguments of the syntax. Next argument is to calculate** known_x’s**.

Here** known_x’s** (independent value) is periods that is the month of the year 2021, you can give the known values. Hence the values are from** B3:B9**.

##### STEP 6:

Press enter to get the calculated results.

Therefore, the sales amount for the 8th period is 118.7571.

##### STEP 7:

To calculate the amount for the remaining months, you can just click and drag from the before value which you are calculated.

## Leave a Review