Exam 4: Estimating and Forecasting Demand

You are a newly hired marketing trainee for a local corporation. Senior management has wondered how other local firms view your company's reputation. One suggestion is to call a variety of managers from a master contact list of firms that your firm has done business with over the last 12 months and ask them what they think of the company. How reliable is this kind of survey method?

A time-series model attempts to identify:

What are the two main categories of forecasting models? How do they differ?

The difference between the predicted value and the actual value of a variable in a regression analysis is called:

Heteroscedasticity occurs when:

What are the different categories into which a time-series pattern can be broken? Briefly describe each.

If a forecaster is analyzing sales of gasoline in a large city during the next two years, which time-series component is likely to be most important?

Which of the following can be used to correct for seasonality in time-series modeling?

Suppose that in a given regression, the R² = .945, the number of observations is 14, and the number of coefficients is 5. What is the adjusted R²? (round off your answer up to three decimal places)

How would a forecaster determine which functional form of an equation to use to predict a variable?

Liza is a manager of a leading soft drink manufacturing firm. Liza uses 10 months data and estimates the following demand equation: Q = 10 - .5P + 1.5Y + .25P_R (2) (.17) (.75) (.50) where P is the price of the soft drink manufactured by Liza's firm, Y refers to household per capita income, and P_R is the price of a rival soft drink manufacturing firm. The standard errors of the coefficients are given in the parentheses. Which of the explanatory variables have significant effects on the demand for soft drink manufactured by Liza's firm? Explain. (At 95% confidence level, the relevant t-statistic for 6 degrees of freedom is 1.94)

A response bias occurs when:

In contrast to simple regression, multiple regression considers:

If a study examines several different markets at the same time, and compares outcomes with conditions in each market, it is specifically using:

Computing the F-statistic allows one to:

The equation Q = a + bt + ct² represents: