Question 1

What is the approximate forecast for May using a four-month moving average?
$$\begin{array} { c c c c c c } 
\text { Nov. } & \text { Dec. } & \text { Jan. } & \text { Feb. } & \text { Mar. } & \text { April } \
39 & 36 & 40 & 42 & 48 & 46
\end{array}$$

Accepted Answer

A)  38 
B)  42 
C)  43 
D)  44 
E)  47 
A)  38 
B)  42 
C)  43 
D)  44 
E)  47

Question 2

A time-series model uses a series of past data points to make the forecast.

Accepted Answer

A) True 
 B)False

Question 3

Gradual movement in time-series data over time is called

Accepted Answer

A)  seasonal variation 
B)  a cycle 
C)  a trend 
D)  exponential variation 
E)  random variation 
A)  seasonal variation 
B)  a cycle 
C)  a trend 
D)  exponential variation 
E)  random variation

Question 4

Regression lines graphically depict "cause-and-effect" relationships.

Accepted Answer

A) True 
 B)False

Question 5

The primary purpose of the mean absolute deviation (MAD) in forecasting is to

Accepted Answer

A)  estimate the trend line 
B)  eliminate forecast errors 
C)  measure forecast accuracy 
D)  seasonally adjust the forecast 
E)  all of the above 
A)  estimate the trend line 
B)  eliminate forecast errors 
C)  measure forecast accuracy 
D)  seasonally adjust the forecast 
E)  all of the above

Question 6

__________ forecasting tries a variety of computer models and selects the best one for a particular application.

Accepted Answer

The answer of __________ forecasting tries a variety of computer...

Question 7

Demand for a certain product is forecast to be 800 units per month, averaged over all 12 months of the year. The product follows a seasonal pattern, for which the January monthly index is 1.25. What is the seasonally-adjusted sales forecast for January?

Accepted Answer

A)  640 units 
B)  798.75 units 
C)  801.25 units 
D)  1000 units 
E)  88.33 units 
A)  640 units 
B)  798.75 units 
C)  801.25 units 
D)  1000 units 
E)  88.33 units

Question 8

If Brandon Edward were working to develop a forecast using a moving averages approach, but he noticed a detectable trend in the historical data, he should

Accepted Answer

A)  use weights to place more emphasis on recent data 
B)  use weights to minimize the importance of the trend 
C)  change to a naïve approach 
D)  use a simple moving average 
E)  change to a qualitative approach 
A)  use weights to place more emphasis on recent data 
B)  use weights to minimize the importance of the trend 
C)  change to a naïve approach 
D)  use a simple moving average 
E)  change to a qualitative approach

Question 9

__________ is a forecasting technique based upon salespersons' estimates of expected sales.

Accepted Answer

Sales forc

Question 10

A(n) __________ forecast uses an average of the most recent periods of data to forecast the next period.

Accepted Answer

The answer of A(n) __________ forecast uses an average of...

Question 11

The tracking signal is the

Accepted Answer

A)  standard error of the estimate 
B)  absolute deviation of the last period's forecast 
C)  mean absolute deviation (MA
D)  
D)  ratio of cumulative error/MAD 
E)  mean absolute percentage error (MAP
E)  
A)  standard error of the estimate 
B)  absolute deviation of the last period's forecast 
C)  mean absolute deviation (MA
D)  
D)  ratio of cumulative error/MAD 
E)  mean absolute percentage error (MAP
E)

Question 12

A small family-owned restaurant uses a seven-day moving average model to determine manpower requirements. These forecasts need to be seasonalized because each day of the week has its own demand pattern. The seasonal indices for each day of the week are: Monday, 0.445; Tuesday, 0.791; Wednesday, 0.927; Thursday, 1.033; Friday, 1.422; Saturday, 1.478; and Sunday 0.903. Average daily demand based on the most recent moving average is 194 patrons. What is the seasonalized forecast for each day of next week?

Accepted Answer

The average value multiplied by each day

Question 13

The quarterly sales for specific educational software over the past three years are given in the following table. Compute the four seasonal factors.
 $$\begin{array} { | c | c | c | c | } 
\hline & \text { YEAR 1 } & \text { YEAR 2 } & \text { YEAR 3 } \
\hline \text { Quarter 1 } & 1710 & 1820 & 1830 \
\hline \text { Quarter 2 } & 960 & 910 & 1090 \
\hline \text { Quarter 3 } & 2720 & 2840 & 2900 \
\hline \text { Quarter 4 } & 2430 & 2200 & 2590 \
\hline
\end{array}$$

Accepted Answer

The answer of The quarterly sales for specific educational software...

Question 14

Linear regression is known as a(n) __________ because it incorporates variables or factors that might influence the quantity being forecast.

Accepted Answer

The answer of Linear regression is known as a(n) __________...

Question 15

Distinguish a dependent variable from an independent variable.

Accepted Answer

The independent variable is re

Question 16

Organizations use which three major types of forecasts, including two that may fall outside the role of the operations manager?

Accepted Answer

A)  strategic, tactical, and operational 
B)  economic, technological, and demand 
C)  exponential smoothing, Delphi, and regression 
D)  causal, time-series, and seasonal 
E)  departmental, organizational, and territorial 
A)  strategic, tactical, and operational 
B)  economic, technological, and demand 
C)  exponential smoothing, Delphi, and regression 
D)  causal, time-series, and seasonal 
E)  departmental, organizational, and territorial

Question 17

Compare seasonal effects and cyclical effects.

Accepted Answer

A cycle is longer (typically s

Question 18

Marie Bain is the production manager at a company that manufactures hot water heaters. Marie needs a demand forecast for the next few years to help decide whether to add new production capacity. The company's sales history (in thousands of units) is shown in the table below. Use exponential smoothing with trend adjustment, to forecast demand for period 6. The initial forecast for period 1 was 11 units; the initial estimate of trend was 0. The smoothing constants are α = .3 and β = .3
 $$\begin{array} { | c | c | } 
\hline \text { Period } & \text { Actual } \
\hline 1 & 12 \
\hline 2 & 15 \
\hline 3 & 16 \
\hline 4 & 16 \
\hline 5 & 18 \
\hline 6 & 20 \
\hline
\end{array}$$

Accepted Answer

The answer of Marie Bain is the production manager at...

Question 19

Which of the following is not a step in the forecasting process?

Accepted Answer

A)  Determine the use of the forecast. 
B)  Eliminate any assumptions. 
C)  Determine the time horizon. 
D)  Select forecasting model. 
E)  Validate and implement the results. 
A)  Determine the use of the forecast. 
B)  Eliminate any assumptions. 
C)  Determine the time horizon. 
D)  Select forecasting model. 
E)  Validate and implement the results.

Question 20

Mean Squared Error and Coefficient of Correlation are two measures of the overall error of a forecasting model.

Accepted Answer

A) True 
 B)False

Exam 4: Forecasting

What is the approximate forecast for May using a four-month moving average? Nov. Dec. Jan. Feb. Mar. April 39 36 40 42 48 46

A time-series model uses a series of past data points to make the forecast.

Gradual movement in time-series data over time is called

Regression lines graphically depict "cause-and-effect" relationships.

The primary purpose of the mean absolute deviation (MAD) in forecasting is to

__________ forecasting tries a variety of computer models and selects the best one for a particular application.

Demand for a certain product is forecast to be 800 units per month, averaged over all 12 months of the year. The product follows a seasonal pattern, for which the January monthly index is 1.25. What is the seasonally-adjusted sales forecast for January?

If Brandon Edward were working to develop a forecast using a moving averages approach, but he noticed a detectable trend in the historical data, he should

__________ is a forecasting technique based upon salespersons' estimates of expected sales.

A(n) __________ forecast uses an average of the most recent periods of data to forecast the next period.

The tracking signal is the

The quarterly sales for specific educational software over the past three years are given in the following table. Compute the four seasonal factors. YEAR 1 YEAR 2 YEAR 3 Quarter 1 1710 1820 1830 Quarter 2 960 910 1090 Quarter 3 2720 2840 2900 Quarter 4 2430 2200 2590

Linear regression is known as a(n) __________ because it incorporates variables or factors that might influence the quantity being forecast.

Distinguish a dependent variable from an independent variable.

Organizations use which three major types of forecasts, including two that may fall outside the role of the operations manager?

Compare seasonal effects and cyclical effects.

Which of the following is not a step in the forecasting process?

Mean Squared Error and Coefficient of Correlation are two measures of the overall error of a forecasting model.

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