Question 1

Explain judgmental forecasting, including grass roots forecasting and the Delphi Method.

Accepted Answer

Judgmental forecasting relies upon opini

Question 2

In an exponential smoothing model, larger values of alpha (i.e., closer to 1) place less emphasis on recent data and more on older data.

Accepted Answer

A) True 
 B)False

Question 3

The Delphi method is a forecasting approach that is based on expert opinion.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is not a statistical method?

Accepted Answer

A) Delphi 
B) Exponential smoothing 
C) Moving average 
D) Linear regression 
A) Delphi 
B) Exponential smoothing 
C) Moving average 
D) Linear regression

Question 5

A moving average model works best when ____ in the time series.

Accepted Answer

A) Only irregular variation is present 
B) Only a trend is present 
C) There is no trend, seasonal, or cyclical pattern 
D) Trend, seasonal, and cyclical patterns all exist 
A) Only irregular variation is present 
B) Only a trend is present 
C) There is no trend, seasonal, or cyclical pattern 
D) Trend, seasonal, and cyclical patterns all exist

Question 6

Judgmental forecasting should only be used if no historical data are available.

Accepted Answer

A) True 
 B)False

Question 7

Another name for planning horizon is time bucket.

Accepted Answer

A) True 
 B)False

Question 8

Explain the difference between a moving average and single exponential smoothing forecasting model.

Accepted Answer

A moving average (MA) forecast is an ave

Question 9

Community General Hospital finds itself treating many bicycle accident victims.Data from the last seven 24-hour periods is shown below:
   
a.What is the forecast for day 4 using a moving average model with AP = 3?
b.With an alpha value of .5 and a starting forecast in day 4 equal to the actual data, what is the exponentially smoothed forecast for day 8?
c.What is the MAD for days 6 to 8 for an exponentially smoothed forecasting model with an alpha value of .5 and a starting forecast in day 4 equal to the actual data?
d.What is the tracking signal for days 6 to 8 for an exponentially smoothed forecasting model with an alpha value of .5 and a starting forecast in day 4 equal to the actual data?

Accepted Answer

a.F (Day 4) = (4 + 8 + 6) / 3 = 6
b.F(Da

Question 10

In practice, managers rely almost exclusively on statistical forecasts.

Accepted Answer

A) True 
 B)False

Question 11

Regression models are often used in forecasting to incorporate causal variables that may influence a time series.

Accepted Answer

A) True 
 B)False

Question 12

A major biotechnology company has developed a new drug for arthritis victims using gene-splicing technology.It has been on the market for five months and has experienced the following sales (in thousands of dollars):
   
a.What is the exponential smoothing forecast for May assuming that January sales is also the initial forecast and the alpha value is .5?
b.What is the exponential smoothing forecast for May assuming that January sales is also the initial forecast and the alpha value is .8?
c.What is the MAD for exponentially smoothed forecasts for months March to May assuming that January sales is also the initial forecast and the alpha value is .5?
d.What is the MAD for exponentially smoothed forecasts for months March to May assuming that January sales is also the initial forecast and the alpha value is .8?
e.What is the tracking signal for exponentially smoothed forecasts for months March to May assuming that January sales is also the initial forecast and the alpha value is .5?
f.What is the tracking signal for exponentially smoothed forecasts for months March to May assuming that January sales value is .8?

Accepted Answer

a.F(February) = 26 + .5(26 - 26) = 26
F(

Question 13

Trends are characterized by repeatable periods of ups and downs over short periods of time.

Accepted Answer

A) True 
 B)False

Question 14

The smoothing constant, $\alpha$, used in the basic exponential smoothing model, can range in value from -1 to +1.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is not one of the five characteristics of a time series?

Accepted Answer

A) Time bucket 
B) Trend 
C) Cyclical 
D) Random variation 
A) Time bucket 
B) Trend 
C) Cyclical 
D) Random variation

Question 16

A major difference between forecast accuracy measures MAD and MSE is that MAD is influenced much more by large forecast errors than by small errors.

Accepted Answer

A) True 
 B)False

Question 17

An R2 of 0.70 mean 30% of the variability in the dependent variable was explained by the independent variable.

Accepted Answer

A) True 
 B)False

Question 18

Exponential smoothing models "never forget" past data as long as the smoothing constant is strictly between 0 and 1.In contrast, moving average methods "completely forget" all data older than k periods in the past.

Accepted Answer

A) True 
 B)False

Question 19

Regular patterns in a data series that take place over long periods of time are called ____.

Accepted Answer

A) Trends 
B) Seasonal patterns 
C) Cyclical patterns 
D) Irregular variation 
A) Trends 
B) Seasonal patterns 
C) Cyclical patterns 
D) Irregular variation

Question 20

A group of international experts published a set of principles of forecasting that includes all of the following except

Accepted Answer

A) Use quantitative rather than qualitative methods. 
B) Combine forecasts from approaches that are similar. 
C) Ask experts to justify their forecasts in writing. 
D) Use multiple measures of forecast accuracy. 
A) Use quantitative rather than qualitative methods. 
B) Combine forecasts from approaches that are similar. 
C) Ask experts to justify their forecasts in writing. 
D) Use multiple measures of forecast accuracy.

Exam 11: Forecasting and Demand Planning

Explain judgmental forecasting, including grass roots forecasting and the Delphi Method.

In an exponential smoothing model, larger values of alpha (i.e., closer to 1) place less emphasis on recent data and more on older data.

The Delphi method is a forecasting approach that is based on expert opinion.

Which of the following is not a statistical method?

A moving average model works best when ____ in the time series.

Judgmental forecasting should only be used if no historical data are available.

Another name for planning horizon is time bucket.

Explain the difference between a moving average and single exponential smoothing forecasting model.

In practice, managers rely almost exclusively on statistical forecasts.

Regression models are often used in forecasting to incorporate causal variables that may influence a time series.

Trends are characterized by repeatable periods of ups and downs over short periods of time.

The smoothing constant, α\alphaα , used in the basic exponential smoothing model, can range in value from -1 to +1.

Which of the following is not one of the five characteristics of a time series?

A major difference between forecast accuracy measures MAD and MSE is that MAD is influenced much more by large forecast errors than by small errors.

An R2 of 0.70 mean 30% of the variability in the dependent variable was explained by the independent variable.

Exponential smoothing models "never forget" past data as long as the smoothing constant is strictly between 0 and 1.In contrast, moving average methods "completely forget" all data older than k periods in the past.

Regular patterns in a data series that take place over long periods of time are called ____.

A group of international experts published a set of principles of forecasting that includes all of the following except

Goods, Services, and Operations Management

Value Chains

Measuring Performance in Operations

Operations Strategy

Technology and Operations Management

Goods and Service Design

Process Selection, Design, and Analysis

Facility and Work Design

Supply Chain Design

Capacity Management

Managing Inventories

Resource Management

Operations Scheduling and Sequencing

Quality Management

Quality Control and Spc

Lean Operating Systems

Project Management

Work Measurement, Learning Curves, and Standards

Queuing Analysis

Modeling Using Linear Programming

Simulation

Decision Analysis

Filters

The smoothing constant, $\alpha$ , used in the basic exponential smoothing model, can range in value from -1 to +1.

An R² of 0.70 mean 30% of the variability in the dependent variable was explained by the independent variable.