| HBS Case Collection
(Revised from original version)
Science Technology Co.
The president of a medium-sized electronics company is evaluating the financial forecasts and proposed financing program submitted by the chief financial officer. The forecasts are prepared in constant dollars, on which basis the proposed financing plan seems reasonable. However, when inflation is incorporated into the forecasts, the financing need far exceeds available sources of funds, and adjustment on the operating side is necessary. The danger of relying on a single set of forecasts based on the most likely outcome is also demonstrated.
Forecasting and Prediction;
Inflation and Deflation;
Risk and Uncertainty;
Outcome or Result;
Piper, Thomas R. "Science Technology Co." Harvard Business School Case 275-058, May 1994. (Revised from original November 1974 version.)