Extrapolation is a mathematical method that predicts beyond the distinct range by programming and expanding past known data. So it’s a type of Excel data analysis and visualization. In this tutorial, we’re going to learn how to extrapolate data in Excel.
An inventory Excel template for your warehouse can give you specific information about both in-stock items and those on order, including reorder time, reorder quantity and discontinued items. For details about your existing equipment, an Excel inventory template stores everything you need, including stock number, physical condition,. There are many ways to generate a forecast for your historical data. Before Excel 2016, many used the FORECAST sheet function, which performs a linear forecast or extended trendlines in chart properties to extrapolate forward. The new functionality in Excel 2016 utilizes another algorithm, called Exponential Smoothing or ETS. This Mac application is an intellectual property of Microsoft. The program lies within Productivity Tools, more precisely Office Tools. The most popular versions among Microsoft Excel for Mac users are 14.0, 12.3 and 10.1. This program's bundle is identified as com.microsoft.Excel. Then, under the ‘Forecast’ group, click the ‘Forecast Sheet’ icon: A window will pop up about creating a forecast worksheet. In here, you can choose when the forecast will end by adjusting the date as well as the chart that will be used to visualize the forecast.
Table of Content
- How to Extrapolate Nonlinear Data by Trendline
- Choose The Best Trendline
- Extrapolation Data by the Forecast Function
- Forecast.Linear
- Forecast.ETS
- Excel Trend Function
Extrapolation Formula
To extrapolate data by formula, we need to use two points of the linear chart that we plotted before.
- A(a, b)
- B(c, d)
Excel Forecast Chart
The linear extrapolation formula is:
Y(x)=b+(x-a)*(d-b)/(c-a)
You can enter the formula according to two points of your data values and extrapolate the target value.
How to Extrapolate a Graph by Trendline
Extrapolating a graph by trendline helps you represent visual data trends. Here we’re going to learn how to add a trendline to our charts:
- Select the data range.
- Go to the Insert tab from the ribbon.
- From the chart section, click on the Line chart (you can pick up the Scatter chart too.)
- Click on the Chart Element icon and check the Trendline checkbox.
- Double-click on the trend line of the graph to open the Format Trendline pane and apply your custom setting.
How to Extrapolate Nonlinear Data by Trendline
When you have a nonlinear dataset, you need to detect the data change trend using a trendline and then forecast the desired value. Here’s how you can do it:
- Draw a scatter plot.
- Click on the Chart Element icon and check the Trendline checkbox.
- Double-click on the trend line of the graph to open the Format Trendline pane.
- Add different types of trendline (exponential, logarithmic, and polynomial) to the chart and check “Display R-squared value on chart” and “Display Equation on Chart” boxes.
To determine the best trendline look at the R-squared value. The highest R-squared value shows the best trendline for your data. - put x in the equation shown in the chart.
Choose The Best Trendline
When you have a data set, you need to detect the data change trend and forecast them in a graph.
Point: Do not use trendlines for Radar, Pie, Doughnut, Bubble, and 3D graphs.
In Excel, we have six types of trendlines.
- Exponential
- Linear
- Logarithmic
- Polynomial
- Power
- Moving Average
Exponential
When data values rise or fall at increasingly higher rates, and there are no zero or negative Y values, we use the Exponential trendline.
Linear
When your plotted data set is similar to a line, in other words, when the data is increasing or decreasing at a steady rate, use the Linear trendline.
Logarithmic
When you have a swift data decrease or increase, use the Logarithmic trendline. The data could be negative or positive. Invalid for zero or negative X values.
Polynomial
Assume you have a large data set that is analyzing gains and losses. Fluctuation is the main reason for using this trendline.
Power
This trendline is used when you compare measurements that increase at a specific rate. Invalid for zero or negative X values.
Moving Average
This trendline uses the average of the particular number of data points by the Period option.
DataExtrapolation by the Forecast Function
If you need a function to predict your data without creating charts and graphs in Excel, use the Excel Forecast function. The Forecast function helps you extrapolate numerical data over a linear trend. Also, you can extrapolate a periodical template or even extrapolate a sheet.
Here we’re going to learn how to use the Forecast.linear, and the Forecast.ETS functions and how to extrapolate a sheet.
Forecast.Linear
Extrapolation adjudges that the relationship between known values will also apply to unknown values. This function helps you extrapolate data that contains two sets of numerical values which correspond to each other.
Below is the Syntax of the Forecast.Linear function:
=FORECAST.LINEAR(x؛ known Ys؛ known Xs)
Assume we have a set of data that shows the number of sales for nine-month. We need to predict sales for the next three months. To use this function, follow these steps:
- Select an empty cell.
- Enter the =forecast or the =forecast.linear in the Formula Bar.
- Click on the x value you want to predict for itself, and enter a semicolon or comma(according to your Excel version.)
- Select all known Ys, enter a semicolon, and then select all known Xs.
- Press Enter.
Possible Error
#N/A: If the size of the known_Ys and known_Xs is not equal, or if one or both are empty, This error will occur.
#DIV/0: If the variance of the known_Xs is equal to zero, this error will occur
#VALUE: If the input x is non-numeric, This error will occur. Click on the link if you want to know more about Excel formula errors and why they happen.
Forecast.ETS
In some cases, you have a seasonal pattern, and this periodical template needs a particular function to forecast the future. Here we have a sales amount for a year, and we need to predict the first three months of the next year.
The syntax of the Forecast.ETS function is:
=FORECAST.ETS(target_date؛ values؛ timeline؛ [seasonality], [data_complation]; [aggregation])
Target_date: The point you need to forecast.
Values: Here are all known sales amounts.
Timeline: In this case, the number of months.
[seasonality]: The length of the seasonal pattern (optional argument.)
[data_complation]: Although the timeline requires a constant step between data points, FORECAST.ETS supports up to 30% of missing data and will automatically adjust for it (optional argument.)
[aggregation]: The aggregation parameter is a numeric value indicating which method will be used to aggregate several values with the same timestamp (optional argument.)
Now follow these steps to forecast your target values:
- Select an empty cell where you want to represent the result.
- Enter the syntax of the function and enter the arguments, as we mentioned.
- Press Enter.
Possible Errors
#N/A: If the values and timeline arrays have different sizes, this error is returned
#VALUE: If any of the seasonality, data completion or aggregation arguments is non-numeric, this error will occur.
#NUM: This error will be returned if the seasonality exceeds 87600, the data completion value is anything other than 0 or 1, aggregation value is not valid (any non-integer number or out of 1-7 range), or the function cannot detect a consistent step size in the timeline. If you want to know more about Excel formula errors and why they happen, click on the link.
Extrapolating Sheets
Excel 2016 and later versions provide a tool to forecast the sheet. This tool creates a table according to your data and determines lower and upper confidence bound.
To use the Forecast Sheet, go to the Data tab from the Forecast group, click on the Forecast Sheet tool to open the Create Forecast Worksheet box. You can pick a line chart or column chart by their icons in the top right corner of the box.
If you need to customize the forecast chart, you can edit by clicking on options:
- Where the Forecast starts or ends
- Change the confidence interval
- Add the Forecast statistics
- Change the Timeline and Values range
- And aggregate duplicate using
Then press the Create button and see the result.
Excel Trend Function
Another function to extrapolate data without plotting graphs is the Trend function in Excel. This statistical function is going to predict future trends according to the known values based on linear regression.
The syntax of the Trend function:
=TREND(known_Ys; [known_Xs]; [new_Xs]; [const])
Known Ys: The Y values we already know.
Known Xs: The X values we already know (optional argument.)
Const: according to Y=mX+b, if const is false, b is zero, but if const is true or skipped, b is calculated normally.
Possible Errors
#REF!: If known_Xs and known_Ys arguments have different sizes, this error occurs
#VALUE: This error occurs if you enter a non-logical value as the const argument, or you enter a non-numeric value as the function’s other arguments. Click on the link if you want to know more about Excel formula errors and why they happen.
You can connect with us, ask our experts if you have any inquiries, and get more support via Excel Support Services.
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FAQ
1- Is extrapolation reliable?Forecast Sheet In Excel For Mac Download
Generally, extrapolation is not so reliable because we cannot be sure that the data trend will continue out of our data range. In addition, there is nothing to check how accurate our prediction is. However, when our original data is very consistent, we can rely on extrapolation.
2- What is the difference between extrapolation and regression?Regression is the mathematical process to find a line or curve that fits the data. Once you find the proper line or curve, you can predict the unknown value based on its equation.
3- What is the difference between the FORECAST and TREND functions?When working with time series, both of them return the same result since they use the same mathematical method.
The difference between these two is that the FORECAST function works only as a regular formula returning one value as output. In contrast, the TREND function can be used as an array formula and calculate multiple y values corresponding to multiple x values.
The difference between these two is that the FORECAST function works only as a regular formula returning one value as output. In contrast, the TREND function can be used as an array formula and calculate multiple y values corresponding to multiple x values.
FORECAST.LINEAR | FORECAST.ETS | Forecast Sheet
The FORECAST (or FORECAST.LINEAR) function in Excel predicts a future value along a linear trend. The FORECAST.ETS function in Excel predicts a future value using Exponential Triple Smoothing, which takes into account seasonality.
Note: the FORECAST function is an old function. Microsoft Excel recommends using the new FORECAST.LINEAR function which produces the exact same result.
FORECAST.LINEAR
1. The FORECAST.LINEAR function below predicts a future value along a linear trend.
Explanation: when we drag the FORECAST.LINEAR function down, the absolute references ($B$2:$B$11 and $A$2:$A$11) stay the same, while the relative reference (A12) changes to A13 and A14.
2. Enter the value 89 into cell C11, select the range A1:C14 and insert a scatter plot with straight lines and markers.
Note: when you add a trendline to an Excel chart, Excel can display the equation in a chart. This equation predicts the same future values.
FORECAST.ETS
The FORECAST.ETS function in Excel 2016 or later is a great function which can detect a seasonal pattern.
1. The FORECAST.ETS function below predicts a future value using Exponential Triple Smoothing.
Note: the last 3 arguments are optional. The fourth argument indicates the length of the seasonal pattern. The default value of 1 indicates seasonality is detected automatically.
2. Enter the value 49 into cell C13, select the range A1:C17 and insert a scatter plot with straight lines and markers. Red alert 4.
3. You can use the FORECAST.ETS.SEASONALITY function to find the length of the seasonal pattern. After seeing the chart, you probably already know the answer.
Conclusion: in this example, when using the FORECAST.ETS function, you can also use the value 4 for the fourth argument.
Forecast Sheet
Use the Forecast Sheet tool in Excel 2016 or later to automatically create a visual forecast worksheet.
1. Select the range A1:B13 shown above.
Forecast Sheet In Excel For Mac Os
2. On the Data tab, in the Forecast group, click Forecast Sheet.
Excel launches the dialog box shown below.
3. Specify when the forecast ends, set a confidence interval (95% by default), detect seasonality automatically or manually set the length of the seasonal pattern, etc.
4. Click Create.
This tool uses the FORECAST.ETS function and calculates the same future values. The lower and upper confidence bounds are a nice bonus.
Explanation: in period 13, we can be 95% confident that the number of visitors will be between 86 and 94.