Question 1

Describe three popular measures of forecast accuracy.

Accepted Answer

Measures of forecast accuracy include: (

Question 2

The three major types of forecasts used by organizations in planning future operations are:

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 3

A forecast with a time horizon of about 3 months to 3 years is typically called a:

Accepted Answer

A) long-range forecast. 
B) medium-range forecast. 
C) short-range forecast. 
D) weather forecast. 
E) strategic forecast. 
A) long-range forecast. 
B) medium-range forecast. 
C) short-range forecast. 
D) weather forecast. 
E) strategic forecast.

Question 4

The tracking signal is the:

Accepted Answer

A) standard error of the estimate. 
B) absolute deviation of the last period's forecast. 
C) MAD. 
D) ratio of cumulative error / MAD. 
E) MAPE. 
A) standard error of the estimate. 
B) absolute deviation of the last period's forecast. 
C) MAD. 
D) ratio of cumulative error / MAD. 
E) MAPE.

Question 5

Which of the following statements comparing exponential smoothing to the weighted moving average technique is TRUE?

Accepted Answer

A) Exponential smoothing is more easily used in combination with the Delphi method. 
B) More emphasis can be placed on recent values using the weighted moving average. 
C) Exponential smoothing is considerably more difficult to implement on a computer. 
D) Exponential smoothing typically requires less record keeping of past data. 
E) Exponential smoothing allows one to develop forecasts for multiple periods,whereas the weighted moving average technique does not. 
A) Exponential smoothing is more easily used in combination with the Delphi method. 
B) More emphasis can be placed on recent values using the weighted moving average. 
C) Exponential smoothing is considerably more difficult to implement on a computer. 
D) Exponential smoothing typically requires less record keeping of past data. 
E) Exponential smoothing allows one to develop forecasts for multiple periods,whereas the weighted moving average technique does not.

Question 6

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

Question 7

When one constant is used to smooth the forecast average and a second constant is used to smooth the trend,the forecasting method is ________.

Accepted Answer

exponential smoothing with tre

Question 8

A fundamental distinction between trend projection and linear regression is that:

Accepted Answer

A) trend projection uses least squares while linear regression does not. 
B) only linear regression can have a negative slope. 
C) in trend projection the independent variable is time;in linear regression the independent variable need not be time,but can be any variable with explanatory power. 
D) trend projection can be a function of several variables,while linear regression can only be a function of one variable. 
E) trend projection uses two smoothing constants,not just one. 
A) trend projection uses least squares while linear regression does not. 
B) only linear regression can have a negative slope. 
C) in trend projection the independent variable is time;in linear regression the independent variable need not be time,but can be any variable with explanatory power. 
D) trend projection can be a function of several variables,while linear regression can only be a function of one variable. 
E) trend projection uses two smoothing constants,not just one.

Question 9

Most forecasting techniques assume that there is some underlying stability in the system.

Accepted Answer

A) True 
 B)False

Question 10

A trend projection equation with a slope of 0.78 means that there is a 0.78 unit rise in Y per period.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following smoothing constants would make an exponential smoothing forecast equivalent to a naive forecast?

Accepted Answer

A) 0 
B) 1 divided by the number of periods 
C) 0.5 
D) 1.0 
E) cannot be determined 
A) 0 
B) 1 divided by the number of periods 
C) 0.5 
D) 1.0 
E) cannot be determined

Question 12

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 an associative multiple regression 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 an associative multiple regression approach. 
D) use a simple moving average. 
E) change to a qualitative approach.

Question 13

The last seven weeks of demand at a new car dealer are shown below.Use a three-period weighted-moving average forecast to determine a forecast for the 8th week using weights of 3,2,and 1 (where the most recent week receives the highest weight).(Round all forecasts to the nearest whole unit. )Calculate the MAD for this forecast (covering all weeks in which error comparisons can be made).What does the MAD indicate?
Week Sales
1 25
2 30
3 27
4 31
5 27
6 29
7 30

Accepted Answer

Week Sales 3WMA |error|
1 25
2

Question 14

The larger the number of periods in the simple moving average forecasting method,the greater the method's responsiveness to changes in demand.

Accepted Answer

A) True 
 B)False

Question 15

In time series,which of the following cannot be predicted?

Accepted Answer

A) large increases in demand 
B) cycles 
C) seasonal fluctuations 
D) random variations 
E) large decreases in demand 
A) large increases in demand 
B) cycles 
C) seasonal fluctuations 
D) random variations 
E) large decreases in demand

Question 16

Name and discuss three qualitative forecasting methods.

Accepted Answer

Qualitative forecasting methods include:

Question 17

A management analyst is using exponential smoothing to predict merchandise returns at an upscale branch of a department store chain.Given an actual number of returns of 154 items in the most recent period completed,a forecast of 172 items for that period,and a smoothing constant of 0.3,what is the forecast for the next period? How would the forecast be changed if the smoothing constant were 0.6? Explain the difference in terms of alpha and responsiveness.

Accepted Answer

166.6;161.2 The larger the smo

Question 18

Identify four quantitative forecasting methods.

Accepted Answer

The list includes naive,moving

Question 19

Which of the following uses three types of participants: decision makers,staff personnel,and respondents?

Accepted Answer

A) jury of executive opinion 
B) sales force composite 
C) Delphi method 
D) associative models 
E) time series 
A) jury of executive opinion 
B) sales force composite 
C) Delphi method 
D) associative models 
E) time series

Question 20

Identify the seven steps involved in forecasting.

Accepted Answer

1.Determine the use of the forecast.
2.S

Exam 4: Forecasting

Describe three popular measures of forecast accuracy.

The three major types of forecasts used by organizations in planning future operations are:

A forecast with a time horizon of about 3 months to 3 years is typically called a:

The tracking signal is the:

Which of the following statements comparing exponential smoothing to the weighted moving average technique is TRUE?

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

When one constant is used to smooth the forecast average and a second constant is used to smooth the trend,the forecasting method is ________.

A fundamental distinction between trend projection and linear regression is that:

Most forecasting techniques assume that there is some underlying stability in the system.

A trend projection equation with a slope of 0.78 means that there is a 0.78 unit rise in Y per period.

Which of the following smoothing constants would make an exponential smoothing forecast equivalent to a naive forecast?

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:

The larger the number of periods in the simple moving average forecasting method,the greater the method's responsiveness to changes in demand.

In time series,which of the following cannot be predicted?

Name and discuss three qualitative forecasting methods.

Identify four quantitative forecasting methods.

Which of the following uses three types of participants: decision makers,staff personnel,and respondents?

Identify the seven steps involved in forecasting.

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