Question 1

A(n)________ is a portion of data from more recent time periods that is used to test different models developed from earlier time period data.

Accepted Answer

The answer of A(n)________ is a portion of data from...

Question 2

Which forecasting technique would you consider for technological forecasts?

Accepted Answer

I would consider the Delphi method becau

Question 3

Forecasts almost always contain errors.

Accepted Answer

A) True 
 B)False

Question 4

What is the difference between mean absolute deviation (MAD)and mean squared error (MSE)?

Accepted Answer

Both MAD and MSE are measurements of the

Question 5

The Delphi method is a process of gaining consensus from a group of experts by debate and voting throughout several rounds of group discussion led by a moderator.

Accepted Answer

A) True 
 B)False

Question 6

A forecaster that uses a holdout set approach as a final test for forecast accuracy typically uses:

Accepted Answer

A) the entire data set available to develop the forecast. 
B) the older observations in the data set to develop the forecast and more recent to check accuracy. 
C) the newer observations in the data set to develop the forecast and older observations to check accuracy. 
D) every other observation to develop the forecast and the remaining observations to check the accuracy. 
A) the entire data set available to develop the forecast. 
B) the older observations in the data set to develop the forecast and more recent to check accuracy. 
C) the newer observations in the data set to develop the forecast and older observations to check accuracy. 
D) every other observation to develop the forecast and the remaining observations to check the accuracy.

Question 7

Polly Prognosticator was the greatest quantitative forecaster in recorded history.A skillful user of all techniques in your chapter on forecasting,she knew better than to try and develop a forecast for data that exhibited a:

Accepted Answer

A) random pattern. 
B) horizontal pattern. 
C) seasonal pattern. 
D) cyclical pattern. 
A) random pattern. 
B) horizontal pattern. 
C) seasonal pattern. 
D) cyclical pattern.

Question 8

What are reasonable criteria for selecting one time-series method over another?

Accepted Answer

Forecast error measures provide importan

Question 9

Consider the following data concerning the performance of a forecasting method.

Accepted Answer

A) The CFE is greater than 100,and the MAD is less than 50. 
B) The CFE is less than 100,and the MAD is less than 50. 
C) The CFE is less than 100,and the MAD is greater than 50. 
D) The CFE is greater than 100,and the MAD is greater than 50. 
A) The CFE is greater than 100,and the MAD is less than 50. 
B) The CFE is less than 100,and the MAD is less than 50. 
C) The CFE is less than 100,and the MAD is greater than 50. 
D) The CFE is greater than 100,and the MAD is greater than 50.

Question 10

Judgment methods of forecasting should never be used with quantitative forecasting methods.

Accepted Answer

A) True 
 B)False

Question 11

There are historically three 32-month periods of generally rising prices in the stock market for every one 9-month period of falling prices.This observation leads you to conclude that the stock market exhibits a:

Accepted Answer

A) random pattern. 
B) trend pattern 
C) seasonal pattern. 
D) cyclical pattern. 
A) random pattern. 
B) trend pattern 
C) seasonal pattern. 
D) cyclical pattern.

Question 12

It would be most appropriate to combine a judgment approach to forecasting with a quantitative approach by:

Accepted Answer

A) having a group of experts examine each historical data point to determine whether it should be included in the model. 
B) combining opinions about the quantitative models to form one forecasting approach. 
C) adjusting a forecast up or down to compensate for specific events not included in the quantitative technique. 
D) developing a trend model to predict the outcomes of judgmental techniques in order to avoid the cost of employing the experts. 
A) having a group of experts examine each historical data point to determine whether it should be included in the model. 
B) combining opinions about the quantitative models to form one forecasting approach. 
C) adjusting a forecast up or down to compensate for specific events not included in the quantitative technique. 
D) developing a trend model to predict the outcomes of judgmental techniques in order to avoid the cost of employing the experts.

Question 13

One aspect of demand that makes every forecast inaccurate is:

Accepted Answer

A) trend variation. 
B) random variation. 
C) cyclical variation. 
D) seasonal variation. 
A) trend variation. 
B) random variation. 
C) cyclical variation. 
D) seasonal variation.

Question 14

Table 8.2
The Agricultural Extension Agent's Office has tracked fertilizer application and crop yields for a variety of chickpea and has recorded the data shown in the following table.Their staff statistician developed the regression model and computed the performance statistics displayed below the data.  
-Use the information provided in Table 8.2.For every unit of fertilizer applied,the crop yield increases by:

Accepted Answer

A) 8)0 bushels. 
B) 8)5 bushels. 
C) 8)9 bushels. 
D) 7)9 bushels. 
A) 8)0 bushels. 
B) 8)5 bushels. 
C) 8)9 bushels. 
D) 7)9 bushels.

Question 15

Demand for a new five-inch color TV during the last six periods has been as follows:   What is the forecast for period 7 if the company uses the simple moving-average method with n = 4?

Accepted Answer

A) fewer than or equal to 115 
B) greater than 115 but fewer than or equal to 120 
C) greater than 120 but fewer than or equal to 125 
D) greater than 125 
A) fewer than or equal to 115 
B) greater than 115 but fewer than or equal to 120 
C) greater than 120 but fewer than or equal to 125 
D) greater than 125

Question 16

A naive forecast is a time-series method whereby the forecast for the next period equals the demand for the current period.

Accepted Answer

A) True 
 B)False

Question 17

A water ski manufacturer believes they can double their sales by producing snow skis during the other half of the year.This approach to demand management is an example of complementary products.

Accepted Answer

A) True 
 B)False

Question 18

Salesforce estimates are extremely useful for technological forecasting.

Accepted Answer

A) True 
 B)False

Question 19

Table 8.4
The Furniture Super Mart is a furniture retailer in Evansville,Indiana.The Marketing Manager wants to prepare a media budget based on the next quarter's business plan.The manager wants to decide the mix of radio advertising and newspaper advertising needed to generate varying levels of Weekly Gross Revenue.The manager has collected data for the past five weeks,and has recorded the following average Weekly Gross Revenues and expenditures for Weekly Radio (X1)and Newspaper (X2)advertising:
   The Manager uses the multiple regression model in OM Explorer and obtains the following results:  
-Use the information provided in Table 8.4.Adding $1,000 of Weekly Radio Advertising (X1)can be expected to increase Weekly Gross Revenues by what amount? (Assume all other variables are held constant. )

Accepted Answer

A) $20,500 
B) $3,750 
C) $6,500 
D) $10,250 
A) $20,500 
B) $3,750 
C) $6,500 
D) $10,250

Question 20

It is now near the end of May and you must prepare a forecast for June for a certain product.The forecast for May was 900 units.The actual demand for May was 1000 units.You are using the exponential smoothing method with α= 0.20.The forecast for June is:

Accepted Answer

A) fewer than 925 units. 
B) greater than or equal to 925 units but fewer than 950 units. 
C) greater than or equal to 950 units but fewer than 1000 units. 
D) greater than or equal to 1000 units. 
A) fewer than 925 units. 
B) greater than or equal to 925 units but fewer than 950 units. 
C) greater than or equal to 950 units but fewer than 1000 units. 
D) greater than or equal to 1000 units.

Exam 8: Forecasting

A(n)________ is a portion of data from more recent time periods that is used to test different models developed from earlier time period data.

Which forecasting technique would you consider for technological forecasts?

Forecasts almost always contain errors.

What is the difference between mean absolute deviation (MAD)and mean squared error (MSE)?

The Delphi method is a process of gaining consensus from a group of experts by debate and voting throughout several rounds of group discussion led by a moderator.

A forecaster that uses a holdout set approach as a final test for forecast accuracy typically uses:

Polly Prognosticator was the greatest quantitative forecaster in recorded history.A skillful user of all techniques in your chapter on forecasting,she knew better than to try and develop a forecast for data that exhibited a:

What are reasonable criteria for selecting one time-series method over another?

Consider the following data concerning the performance of a forecasting method.

Judgment methods of forecasting should never be used with quantitative forecasting methods.

There are historically three 32-month periods of generally rising prices in the stock market for every one 9-month period of falling prices.This observation leads you to conclude that the stock market exhibits a:

It would be most appropriate to combine a judgment approach to forecasting with a quantitative approach by:

One aspect of demand that makes every forecast inaccurate is:

Demand for a new five-inch color TV during the last six periods has been as follows: What is the forecast for period 7 if the company uses the simple moving-average method with n = 4?

A naive forecast is a time-series method whereby the forecast for the next period equals the demand for the current period.

A water ski manufacturer believes they can double their sales by producing snow skis during the other half of the year.This approach to demand management is an example of complementary products.

Salesforce estimates are extremely useful for technological forecasting.

It is now near the end of May and you must prepare a forecast for June for a certain product.The forecast for May was 900 units.The actual demand for May was 1000 units.You are using the exponential smoothing method with α= 0.20.The forecast for June is:

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