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Cost Forecasting Models For The Air Force Flying Hour Program, Tyler J. Hess

Theses and Dissertations

The fiscally constrained environment in which the Air Force executes its mission places great emphasis on accurate cost estimates for planning and budgeting purposes. Inaccurate estimates result in budget risks and undermine the ability of Air Force leadership to allocate resources efficiently. This thesis evaluates the current method used by the Air Force and introduces new methods to forecast future Flying Hour Program costs. The findings suggest the current forecasting method’s assumption of a proportional relationship between cost and flying hours is inappropriate and the relationship is actually inelastic. Prior research has used log-linear least squares regression techniques to forecast …