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SAP Functional, Basis Components, and ABAP Programming Books


APO-DP Forecasting with MLR

How/where to define coefficient for dependent variable in MLR forecast profile?
Coefficient for dependent variable?
Consider this:
Y = ax1 + bx2 + cx3 + ... (x1,x2 are the independent variables and Y is the dependant variable.
a,b,c being the coefficients of the independent variables)
This being the standard equation, I dont see what exactly u mean by the coefiicient of dependant variable.
 

I have worked on MLR and it follows this equation.
Following is the scenario :
1. Dependent variable Y is forecast key figure ( 9ADFCST)
2. History for Dependent Variable / Key figure Y is 0QUANTITY
3. Dependent Variable X is a key figures 9AADDKF1 and 9AADDKF2

These above parameters can be defined in MLR profile.
So the formula will be

 9ADFCST  = ( a * 9AADDKF1) + ( b * 9AADDKF2)
   Y      = ( a *   X1    ) + ( b *   X2    )

Where we have to define the coefficients a and b.
 

You don't define the coefficients a and b (and the constant c and other coeffs if you have more independent variables).  These are computed by the MLR engine when you run MLR.  Their values can be displayed by toggling "Para" from the MLR view after running MLR.  If you experiment by changing the historical values of the independent variables and re-running MLR, you
will see that these coefficients will change (i.e., they are not pre-defined but rather computed based on the input data).

Note that MLR is not recommended unless you have an expert user who can interpret what's going on (R**2, Durbin test results, etc.).  Which presents a catch-22 because if you have such users, they would probably prefer using
other dedicated MLR tools with richer functionality (and ask you to integrate these to APO!).

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