Exam 4: Forecasting

Arnold Tofu owns and operates a chain of 12 vegetable protein "hamburger" restaurants in Quebec. Sales figures and profits for the stores are in the table below. Sales are given in millions of dollars; profits are in hundreds of thousands of dollars. Calculate a regression line for the data. What is your forecast of profit for a store with sales of $24 million? $30 million? Store Profits Sales 1 14 6 2 11 3 3 15 5 4 16 5 5 24 15 6 28 18 7 22 17 8 21 12 9 26 15 10 43 20 11 34 14 12 9 5

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

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. 1 2 3 4 5 6 7 8 9 10 11 12 Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Sales 51 55 54 57 50 68 66 59 67 69 75 73

Demand (sales) forecasts serve as inputs to financial, marketing, and personnel planning.

________ expresses the error as a percent of the actual values, undistorted by a single large value.

What two numbers are contained in the daily report to the CEO of Walt Disney Parks & Resorts regarding the six Orlando parks?

Which time-series model below assumes that demand in the next period will be equal to the most recent period's demand?

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

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

Technological forecasts address the business cycle by predicting inflation rates, money supplies, housing starts, and other planning indicators.

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

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

Many services maintain records of sales noting

________ is a time-series forecasting method that fits a trend line to a series of historical data points and then projects the line into the future for forecasts.

Which of the following statements about time-series forecasting is true?

Linear-regression analysis is a straight-line mathematical model to describe the functional relationships between independent and dependent variables.

Demand forecasts, also called ________ forecasts, are projections of demand for a company's products or services.

Given an actual demand of 61, a previous forecast of 58, and an alpha of .3, what would the forecast for the next period be using simple exponential smoothing?

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

Given an actual demand of 103, a previous forecast value of 99, and an alpha of .4, the exponential smoothing forecast for the next period would be