Exam 9: Forecasting

Forecasts are almost always wrong.

Dividing actual demand by the model's forecast yields an index that can be used to adjust for ________ in the data.

A qualitative forecasting technique in which individuals familiar with specific market segments estimate the demand within these sectors that are then summed to get an overall forecast is called a:

Using the data shown in the table, develop a regression line that can be used to predict the demand for time period number 20. What is the regression equation and what is your forecast for period 20? Period Demand Period * Demand 1 16 16 2 20 40 3 24 72 4 27 108 5 29 145 6 30 180 7 32 224 8 35 280 9 36 324 10 38 380 Sums 55 287 1769

Multiple regression is used when the forecaster believes that more than one independent variable should be used to predict the variable of interest.

As yet another earthquake rattled his china cabinet, the data scientist vowed to once and for all determine whether hydraulic fracturing (where water is injected into the earth)was predictive of the number of earthquakes in the region. Using the data below, develop a regression equation and calculate the MAD and MAPE. Injections Earthquakes 137 682 331 833 360 905 442 1008 478 1482 529 1742

A collaborative planning, forecasting and replenishment system eliminates the need for forecasting.

Supply chain partners might use ________ to develop joint sales and operations plans and projections of output if they have agreed on a common set of objectives.

Which one of the following statements regarding collaborative planning, forecasting, and replenishment (CPFR)systems is best?

Two time series techniques that are appropriate when the data display a strong upward or downward trend are ________ and ________.

The slope of the regression equation is positive if the r-squared value is greater than 0.0.

Demand was low two years ago but increased sharply last year thanks to an aggressive marketing campaign. A time series model that puts the greatest emphasis on the most recent period is probably the best choice to predict next year's demand.

A poultry farmer that dabbles in statistics is interested in exploring the relationship between two types of feed (layer pellets and scratch), water, and the output of his laying hens. For ten days he records the number of ounces of layer pellets and scratch the hens consume and the number of fluid ounces of water and tracks the number of eggs that are produced. Scratch Layer Pellets Water Eggs 48 29 36 24 44 27 34 22 41 22 31 20 42 21 32 20 48 23 34 22 44 28 34 23 42 22 37 21 41 28 33 22 42 22 31 20 47 29 37 24 He develops one equation based on three predictors, the scratch, pellets, and water, and another equation based only on the layer pellet consumption. The output for the two models are shown side by side. Comment on the two models and which one should be used. Pellets, Scratch, Water Pellets Multiple R 0.994 0.904 R Square 0.987 0.817 Adjusted R Square 0.981 0.794 Standard Error 0.214 0.703 Observations 10 10

Nora Damus reviews her forecasting triumphs and failures as part of her annual report to the Chief Operating Officer. She notes that her monthly forecast for batteries has a mean forecast error of 20, and a mean absolute deviation of 20. Which of the following statements about her forecast is BEST?

The Delphi method, panel consensus forecasting, and market surveys are all qualitative forecasting methods, but only market surveys do NOT use experts.

A firm's demand data from the last two quarters is displayed in the table. Use a three period weighted moving average with W_t = 0.7, W_t-1 = 0.2, and W_t-2 = 0.1 to forecast demand for July. Month Demand January 154 February 148 March 214 April 180 May 225 June 246

A tracking signal value between ________ and ________ would suggest that the forecasting technique in use is considered to be performing well.

A counseling service records the number of calls to their hotline for the last year. use this table to answer the following questions: Month Demand Tanuary 111 February 127 March 146 April 159 May 165 fune 165 fuly 178 August 182 September 191 October 208 November 223 December 228 -What is the forecast for October if a weighted moving average with weights of 0.5, 0.3, and 0.2 is used to model this data?

A model with a positive mean forecast error suggests that, on average, the model underforecasts.

A video game publishing company needs to predict the total sales in the European market for the next year. This is an example of a(n):