Question 1

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 2

The last four weekly values of sales were 80, 100, 105, and 90 units. The last four forecasts were 60, 80, 95, and 75 units. These forecasts illustrate

Accepted Answer

A)  qualitative methods 
B)  adaptive smoothing 
C)  slope 
D)  bias 
E)  trend projection 
A)  qualitative methods 
B)  adaptive smoothing 
C)  slope 
D)  bias 
E)  trend projection

Question 3

What are the realities of forecasting that companies face?

Accepted Answer

First, forecasts are seldom perfect. Sec

Question 4

A firm has modeled its experience with industrial accidents and found that the number of accidents per year (Y) is related to the number of employees (X) by the regression equation Y = 3.3 + 0.049*X. R-Square is 0.68. The regression is based on 20 annual observations. The firm intends to employ 480 workers next year. How many accidents do you project? How much confidence do you have in that forecast?

Accepted Answer

Y = 3.3 + 0.049 * 480 = 3.3 + 23.52 = 26

Question 5

A forecasting method has produced the following over the past five months. What is the mean absolute deviation?

Accepted Answer

A)  -0.2 
B)  -1.0 
C)  0.0 
D)  1.2 
E)  8.6 
A)  -0.2 
B)  -1.0 
C)  0.0 
D)  1.2 
E)  8.6

Question 6

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 7

The larger the standard error of the estimate, the more accurate the forecasting model.

Accepted Answer

A) True 
 B)False

Question 8

One advantage of exponential smoothing is the limited amount of record keeping involved.

Accepted Answer

A) True 
 B)False

Question 9

Demand cycles for individual products can be driven by product life cycles.

Accepted Answer

A) True 
 B)False

Question 10

__________ 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 11

If two variables were perfectly correlated, the correlation coefficient r would equal

Accepted Answer

A)  0 
B)  -1 
C)  1 
D)  B or C 
E)  none of the above 
A)  0 
B)  -1 
C)  1 
D)  B or C 
E)  none of the above

Question 12

What is the forecast for May based on a weighted moving average applied to the following past demand data and using the weights: 4, 3, 2 (largest weight is for most recent data)?

Accepted Answer

2x42 + 3x47 + 4x43 =

Question 13

Many services maintain records of sales noting

Accepted Answer

A)  the day of the week 
B)  unusual events 
C)  weather 
D)  holidays 
E)  all of the above 
A)  the day of the week 
B)  unusual events 
C)  weather 
D)  holidays 
E)  all of the above

Question 14

The degree or strength of a relationship between two variables is shown by the

Accepted Answer

A)  alpha 
B)  mean 
C)  mean absolute deviation 
D)  correlation coefficient 
E)  cumulative error 
A)  alpha 
B)  mean 
C)  mean absolute deviation 
D)  correlation coefficient 
E)  cumulative error

Question 15

Increasing the number of periods in a moving average will accomplish greater smoothing, but at the expense of

Accepted Answer

A)  manager understanding 
B)  accuracy 
C)  stability 
D)  responsiveness to changes 
E)  All of the above are diminished when the number of periods increases. 
A)  manager understanding 
B)  accuracy 
C)  stability 
D)  responsiveness to changes 
E)  All of the above are diminished when the number of periods increases.

Question 16

Favors Distribution Company purchases small imported trinkets in bulk, packages them, and sells them to retail stores. They are conducting an inventory control study of all their items. The following data are for one such item, which is not seasonal.
a. Use trend projection to estimate the relationship between time and sales (state the equation).
b. Calculate forecasts for the first four months of the next year.

Accepted Answer

The trend projection equation

Question 17

Yamaha manufactures which set of products with complementary demands to address seasonal fluctuations?

Accepted Answer

A)  golf clubs and skis 
B)  swimming suits and winter jackets 
C)  jet skis and snowmobiles 
D)  pianos and guitars 
E)  ice skates and water skis 
A)  golf clubs and skis 
B)  swimming suits and winter jackets 
C)  jet skis and snowmobiles 
D)  pianos and guitars 
E)  ice skates and water skis

Question 18

Given forecast errors of -1, 4, 8, and -3, what is the mean absolute deviation?

Accepted Answer

A)  2 
B)  3 
C)  4 
D)  8 
E)  16 
A)  2 
B)  3 
C)  4 
D)  8 
E)  16

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is not present in a time series?

Accepted Answer

A)  seasonality 
B)  operational variations 
C)  trend 
D)  cycles 
E)  random variations 
A)  seasonality 
B)  operational variations 
C)  trend 
D)  cycles 
E)  random variations

Exam 4: Forecasting

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

The last four weekly values of sales were 80, 100, 105, and 90 units. The last four forecasts were 60, 80, 95, and 75 units. These forecasts illustrate

What are the realities of forecasting that companies face?

A forecasting method has produced the following over the past five months. What is the mean absolute deviation?

The larger the standard error of the estimate, the more accurate the forecasting model.

One advantage of exponential smoothing is the limited amount of record keeping involved.

Demand cycles for individual products can be driven by product life cycles.

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

If two variables were perfectly correlated, the correlation coefficient r would equal

What is the forecast for May based on a weighted moving average applied to the following past demand data and using the weights: 4, 3, 2 (largest weight is for most recent data)?

Many services maintain records of sales noting

The degree or strength of a relationship between two variables is shown by the

Increasing the number of periods in a moving average will accomplish greater smoothing, but at the expense of

Yamaha manufactures which set of products with complementary demands to address seasonal fluctuations?

Given forecast errors of -1, 4, 8, and -3, what is the mean absolute deviation?

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

Which of the following is not present in a time series?

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