Question 1

Distinguish a dependent variable from an independent variable.

Accepted Answer

The independent variable cause

Question 2

The tracking signal is a measure that indicates whether a method of forecasting is accurately predicting actual change in demand.

Accepted Answer

A) True 
 B)False

Question 3

________ forecasting is a method that selects the best forecast from a group of forecasts generated by simple techniques.

Accepted Answer

The answer of ________ forecasting is a method that selects...

Question 4

Table 10.6
 $$\begin{array} { | l | c | } 
\hline { \text { Month } } & \begin{array} { c } 
\text { Demand } \
\text { (Units) }
\end{array} \
\hline \text { January } & 480 \
\text { February } & 520 \
\text { March } & 535 \
\text { April } & 550 \
\text { May } & 590 \
\text {June } & 630 \
\hline
\end{array}$$
-Use the information in Table 10.6.Use an exponential smoothing model with a smoothing parameter of 0.30 to forecast sales for year 5.

Accepted Answer

A)  less than or equal to 2 
B)  greater than 2 but less than or equal to 3 
C)  greater than 3 but less than or equal to 4 
D)  greater than 4 
A)  less than or equal to 2 
B)  greater than 2 but less than or equal to 3 
C)  greater than 3 but less than or equal to 4 
D)  greater than 4

Question 5

Which one of the following is most useful for measuring the bias in a forecast?

Accepted Answer

A)  cumulative sum of forecast errors 
B)  standard deviation of forecast errors 
C)  mean absolute deviation of forecast errors 
D)  percentage forecast error in period t 
A)  cumulative sum of forecast errors 
B)  standard deviation of forecast errors 
C)  mean absolute deviation of forecast errors 
D)  percentage forecast error in period t

Question 6

Aggregating products or services together generally decreases the forecast accuracy.

Accepted Answer

A) True 
 B)False

Question 7

Compare seasonal effects and cyclical effects.

Accepted Answer

A cycle is longer (typically s

Question 8

Describe the judgment method technique of forecasting.

Accepted Answer

A qualitative method that tran

Question 9

Table 10.6
 $$\begin{array} { | l | c | } 
\hline { \text { Month } } & \begin{array} { c } 
\text { Demand } \
\text { (Units) }
\end{array} \
\hline \text { January } & 480 \
\text { February } & 520 \
\text { March } & 535 \
\text { April } & 550 \
\text { May } & 590 \
\text {June } & 630 \
\hline
\end{array}$$
-Use the information in Table 10.6.Use the exponential smoothing method with ? = 0.5 to forecast the sales for year 5.

Accepted Answer

A)  less than or equal to 3 
B)  greater than 3 but less than or equal to 4 
C)  greater than 4 but less than or equal to 5 
D)  greater than 5 
A)  less than or equal to 3 
B)  greater than 3 but less than or equal to 4 
C)  greater than 4 but less than or equal to 5 
D)  greater than 5

Question 10

What is a tracking signal?

Accepted Answer

A tracking signal is calculated as the s

Question 11

________ is a forecasting method in which the opinions,experience,and technical knowledge of one or more managers are summarized to arrive at a single forecast.

Accepted Answer

The answer of ________ is a forecasting method in which...

Question 12

Table 10.5
 $$\begin{array} { | l | c | } 
\hline{ \text { Month } } & \begin{array} { c } 
\text { Demand } \
\text { (Units) }
\end{array} \
\hline \text { July } & 240 \
\text { August } & 310 \
\text { September } & 280 \
\text { October } & 250 \
\hline
\end{array}$$
-Use the information in Table 10.5.Using the simple moving average technique for the most recent three months,what will be the forecasted demand for November?

Accepted Answer

A)  less than or equal to 260 units 
B)  greater than 260, but less than or equal to 275 units 
C)  greater than 275, but less than or equal to 290 units 
D)  more than 290 units 
A)  less than or equal to 260 units 
B)  greater than 260, but less than or equal to 275 units 
C)  greater than 275, but less than or equal to 290 units 
D)  more than 290 units

Question 13

A systematic increase or decrease in the mean of a demand time series over time is referred to as a cyclical time series.

Accepted Answer

A) True 
 B)False

Question 14

Which one of the following statements about forecasting is FALSE?

Accepted Answer

A)  To achieve the objective of developing a useful forecast from the information at hand, the forecaster must select the appropriate technique. This choice sometimes involves a trade-off between forecast accuracy and cost. 
B)  Three general types of forecasting techniques are used for demand forecasting: time series analysis, causal methods, and judgment methods. 
C)  Time series express the relationship between the factor to be forecast and related factors, such as promotional campaigns, economic conditions, and competitor actions. 
D)  A time series is a list of repeated observations of a phenomenon, such as demand, arranged in the order in which they actually occurred. 
A)  To achieve the objective of developing a useful forecast from the information at hand, the forecaster must select the appropriate technique. This choice sometimes involves a trade-off between forecast accuracy and cost. 
B)  Three general types of forecasting techniques are used for demand forecasting: time series analysis, causal methods, and judgment methods. 
C)  Time series express the relationship between the factor to be forecast and related factors, such as promotional campaigns, economic conditions, and competitor actions. 
D)  A time series is a list of repeated observations of a phenomenon, such as demand, arranged in the order in which they actually occurred.

Question 15

Identify and briefly describe four judgment methods for developing forecasts when no historical data is available to develop the forecasts.

Accepted Answer

The four judgment methods for developing

Question 16

A weighted moving average method that calculates the average of a time series by giving recent demands more weight than earlier methods is called

Accepted Answer

A)  seasonally adjusted smoothing. 
B)  exponential smoothing. 
C)  multiplicative seasonal method. 
D)  cumulative tracking error. 
A)  seasonally adjusted smoothing. 
B)  exponential smoothing. 
C)  multiplicative seasonal method. 
D)  cumulative tracking error.

Question 17

Calculate three forecasts using the following data.First,for periods 4 through 11,develop the exponentially smoothed forecasts using a forecast for period 3 ( $\mathrm { F } _ { 3 }$ )of 79.0 and an alpha of 0.2.Second,calculate the 3-period moving average forecast for periods 4 through 11.Third,calculate the weighted moving average for periods 4 through 11,using weights of .70,.20,and .10.Calculate the mean absolute deviation (MAD)and the cumulative sum of forecast error (CFE)for each forecasting procedure.Which forecasting procedure would you select? Why?
 $$\begin{array} { | c | c | } 
\hline \text { Month } & \text { Demand } \
\hline 1 & 75 \
2 & 79 \
3 & 83 \
4 & 80 \
5 & 87 \
6 & 81 \
7 & 74 \
8 & 88 \
9 & 83 \
10 & 85 \
\hline
\end{array}$$

Accepted Answer

Using MAD,the expone

Question 18

Table 10.1
 $$\begin{array} { | l | c | } 
\hline \ { \text { Month } } & \text { Demand } \
\hline \text { January } & 55 \
\text { February } & 52 \
\text { March } & 57 \
\text { April } & 64 \
\text { May } & 58 \
\text { June } & 54 \
\text { July } & 62 \
\text { August } & 69 \
\hline
\end{array}$$
-Use the information in Table 10.1.What would be the forecast for September if the exponential smoothing technique were used? (? = 0.30 and the forecast for March was 55)

Accepted Answer

A)  less than or equal to 65 
B)  greater than 65 but less than or equal to 67 
C)  greater than 67 but less than or equal to 69 
D)  greater than 69 
A)  less than or equal to 65 
B)  greater than 65 but less than or equal to 67 
C)  greater than 67 but less than or equal to 69 
D)  greater than 69

Question 19

________ variables are the variables in linear regression analysis that are used to predict the measure or quantity being forecast

Accepted Answer

The answer of ________ variables are the variables in linear...

Question 20

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

Exam 10: Managing Demand and Forecasting

Distinguish a dependent variable from an independent variable.

The tracking signal is a measure that indicates whether a method of forecasting is accurately predicting actual change in demand.

________ forecasting is a method that selects the best forecast from a group of forecasts generated by simple techniques.

Table 10.6 Month Demand (Units) January 480 February 520 March 535 April 550 May 590 June 630 -Use the information in Table 10.6.Use an exponential smoothing model with a smoothing parameter of 0.30 to forecast sales for year 5.

Which one of the following is most useful for measuring the bias in a forecast?

Aggregating products or services together generally decreases the forecast accuracy.

Compare seasonal effects and cyclical effects.

Describe the judgment method technique of forecasting.

Table 10.6 Month Demand (Units) January 480 February 520 March 535 April 550 May 590 June 630 -Use the information in Table 10.6.Use the exponential smoothing method with ? = 0.5 to forecast the sales for year 5.

What is a tracking signal?

________ is a forecasting method in which the opinions,experience,and technical knowledge of one or more managers are summarized to arrive at a single forecast.

Table 10.5 Month Demand (Units) July 240 August 310 September 280 October 250 -Use the information in Table 10.5.Using the simple moving average technique for the most recent three months,what will be the forecasted demand for November?

A systematic increase or decrease in the mean of a demand time series over time is referred to as a cyclical time series.

Which one of the following statements about forecasting is FALSE?

Identify and briefly describe four judgment methods for developing forecasts when no historical data is available to develop the forecasts.

A weighted moving average method that calculates the average of a time series by giving recent demands more weight than earlier methods is called

Table 10.1 \ Month Demand January 55 February 52 March 57 April 64 May 58 June 54 July 62 August 69 -Use the information in Table 10.1.What would be the forecast for September if the exponential smoothing technique were used? (? = 0.30 and the forecast for March was 55)

________ variables are the variables in linear regression analysis that are used to predict the measure or quantity being forecast

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

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