Question 1

Forecasts are usually classified by time horizon into which three categories?

Accepted Answer

A) short-range,medium-range,and long-range 
B) finance/accounting,marketing,and operations 
C) strategic,tactical,and operational 
D) exponential smoothing,regression,and time series 
E) departmental,organizational,and industrial 
A) short-range,medium-range,and long-range 
B) finance/accounting,marketing,and operations 
C) strategic,tactical,and operational 
D) exponential smoothing,regression,and time series 
E) departmental,organizational,and industrial A

Question 2

A six-month moving average forecast is generally better than a three-month moving average forecast if demand:

Accepted Answer

A) is rather stable. 
B) has been changing due to recent promotional efforts. 
C) follows a downward trend. 
D) exceeds one million units per year. 
E) follows an upward trend. 
A) is rather stable. 
B) has been changing due to recent promotional efforts. 
C) follows a downward trend. 
D) exceeds one million units per year. 
E) follows an upward trend. A

Question 3

Explain,in your own words,the meaning of the coefficient of determination.

Accepted Answer

The coefficient of determination measures the amount (percent)of total variation in the data that is explained by the model.

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

A time-series trend equation is 25.3 + 2.1x.What is your forecast for period 7?

Accepted Answer

A) 23.2 
B) 25.3 
C) 27.4 
D) 40.0 
E) 179.2 
A) 23.2 
B) 25.3 
C) 27.4 
D) 40.0 
E) 179.2

Question 6

Which of the following is NOT a characteristic of exponential smoothing?

Accepted Answer

A) smoothes random variations in the data 
B) uses an easily altered weighting scheme 
C) weights each historical value equally 
D) has minimal data storage requirements 
E) uses the previous period's forecast 
A) smoothes random variations in the data 
B) uses an easily altered weighting scheme 
C) weights each historical value equally 
D) has minimal data storage requirements 
E) uses the previous period's forecast

Question 7

List and briefly describe the three major types of forecasts that organizations use in planning future operations.

Accepted Answer

The three types are economic,technologic

Question 8

In trend projection,the trend component is the slope of the regression equation.

Accepted Answer

A) True 
 B)False

Question 9

The following trend projection is used to predict quarterly demand: y-hat = 250 - 2.5x,where x = 1 in the first quarter.Seasonal (quarterly)indices are Quarter 1 = 1.5; Quarter 2 = 0.8; Quarter 3 = 1.1; and Quarter 4 = 0.6.What is the seasonally adjusted forecast for the next four quarters?

Accepted Answer

Quarter Projection A

Question 10

An innovative restaurateur owns and operates a dozen "Ultimate Low-Carb" restaurants in northern Arkansas.His signature item is a cheese-encrusted beef medallion wrapped in lettuce.Sales (x,in millions of dollars)is related to Profits (y-hat,in hundreds of thousands of dollars)by the regression equation y-hat = 8.21 + 0.76 x.What is your forecast of profit for a store with sales of $40 million? $50 million?

Accepted Answer

Students must recognize that "sales" is

Question 11

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

Accepted Answer

A) yesterday's forecasted attendance and yesterday's actual attendance 
B) yesterday's actual attendance and today's forecasted attendance 
C) yesterday's forecasted attendance and today's forecasted attendance 
D) yesterday's actual attendance and last year's actual attendance 
E) yesterday's forecasted attendance and the year-to-date average daily forecast error 
A) yesterday's forecasted attendance and yesterday's actual attendance 
B) yesterday's actual attendance and today's forecasted attendance 
C) yesterday's forecasted attendance and today's forecasted attendance 
D) yesterday's actual attendance and last year's actual attendance 
E) yesterday's forecasted attendance and the year-to-date average daily forecast error

Question 12

What is a time-series forecasting model?

Accepted Answer

A time-series foreca

Question 13

A naïve forecast for September sales of a product would be equal to the forecast for August.

Accepted Answer

A) True 
 B)False

Question 14

The primary purpose of the mean absolute deviation (MAD)in forecasting is to:

Accepted Answer

A) estimate the trend line. 
B) eliminate forecast errors. 
C) measure forecast accuracy. 
D) seasonally adjust the forecast. 
E) remove random variations. 
A) estimate the trend line. 
B) eliminate forecast errors. 
C) measure forecast accuracy. 
D) seasonally adjust the forecast. 
E) remove random variations.

Question 15

Explain the role of regression models (time series and otherwise)in forecasting.That is,how is trend projection able to forecast? How is regression used for causal forecasting?

Accepted Answer

For trend projection,the independent var

Question 16

Which of the following most requires long-range forecasting (as opposed to short-range or medium-range forecasting)for its planning purposes?

Accepted Answer

A) job scheduling 
B) production levels 
C) cash budgeting 
D) capital expenditures 
E) purchasing 
A) job scheduling 
B) production levels 
C) cash budgeting 
D) capital expenditures 
E) purchasing

Question 17

Which of the following values of alpha would cause exponential smoothing to respond the SLOWEST to forecast errors?

Accepted Answer

A) 0.10 
B) 0.2246 
C) 0.50 
D) 0.90 
E) cannot be determined 
A) 0.10 
B) 0.2246 
C) 0.50 
D) 0.90 
E) cannot be determined

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

A management analyst is using exponential smoothing to predict merchandise returns at an upscale branch of a department store chain.Given an actual number of returns of 154 items in the most recent period completed,a forecast of 172 items for that period,and a smoothing constant of 0.3,what is the forecast for the next period? How would the forecast be changed if the smoothing constant were 0.6? Explain the difference in terms of alpha and responsiveness.

Accepted Answer

166.6; 161.2 The larger the sm

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 4: Forecasting

Forecasts are usually classified by time horizon into which three categories?

A six-month moving average forecast is generally better than a three-month moving average forecast if demand:

Explain,in your own words,the meaning of the coefficient of determination.

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

A time-series trend equation is 25.3 + 2.1x.What is your forecast for period 7?

Which of the following is NOT a characteristic of exponential smoothing?

List and briefly describe the three major types of forecasts that organizations use in planning future operations.

In trend projection,the trend component is the slope of the regression equation.

The following trend projection is used to predict quarterly demand: y-hat = 250 - 2.5x,where x = 1 in the first quarter.Seasonal (quarterly)indices are Quarter 1 = 1.5; Quarter 2 = 0.8; Quarter 3 = 1.1; and Quarter 4 = 0.6.What is the seasonally adjusted forecast for the next four quarters?

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

What is a time-series forecasting model?

A naïve forecast for September sales of a product would be equal to the forecast for August.

The primary purpose of the mean absolute deviation (MAD)in forecasting is to:

Explain the role of regression models (time series and otherwise)in forecasting.That is,how is trend projection able to forecast? How is regression used for causal forecasting?

Which of the following most requires long-range forecasting (as opposed to short-range or medium-range forecasting)for its planning purposes?

Which of the following values of alpha would cause exponential smoothing to respond the SLOWEST to forecast errors?

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

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

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Human Resources, job Design, and Work Measurement

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