Quiz 2: Forecasting
One qualitative forecasting method bases the forecast for a new product or service on the actual sales history of a similar product or service. An example is forecasting demand for the newest model of iPod by using the demand history from the previous model of iPod. This method is
life cycle analogy.
A qualitative forecasting method which brings experts together to jointly discuss and develop forecasts is
panel consensus forecasting.
Long-term movement of demand up or down in a time series is
a trend.
The following table lists the number of home improvement loans approved by a finance company, along with the loan interest rate.
a. Develop a regression forecast model using the interest rate (in %) as the predictor (i.e., independent) variable.
The regression model is Number of loans equals 34.80 + (-1.54) x interest rate.
b. If the interest rate is 11%, the bank should expect to make 18 loans. If the interest rate is 8.5%,
the bank should expect to make 22 loans.
Which of the following statements about forecasts is true?
Forecasts for the near term tend to be more accurate.
"An estimate of the future value of some variable" is the definition of
a forecast.
"A set of business processes, backed up by information technology, in which supply chain partners agree to mutual business objectives and measures, develop joint sales and operational plans, and collaborate to generate and update sales forecasts and replenishment plans" is the definition of
collaborative planning, forecasting, and replenishment (CPFR).
The situation is vague and little data exists, as in the case of new products or technologies. In this case, which of the following forecasting approachs is used?
qualitative method
Your manager has come to you with the following data, showing actual demand for five periods and forecast results for two different models. Calculate the MFE, MAD, and MAPE for these models.
The MFE value for the forecast Model 1 is negative 0.6.
The MAD value for the forecast Model 1 is 106.2.
The MAPE value for the forecast Model 1 is 32.7%.
The MFE value for the forecast Model 2 is negative 26.2.
The MAD value for the forecast Model 2 is 105.0.
The MAPE value for the forecast Model 2 is 34.5%
Which of the following statements about forecasts is true?
Forecasts for groups of products tend to be more accurate.
Structured questionnaires submitted to potential customers, often to gauge potential demand, are
market surveys.
The situation is stable and historical data exists, as in the case of mature products or technologies. In this case, which of the following forecasting approachs is used?
quantitative method
One qualitative forecasting method uses experts working individually. The individual forecasts are shared among the group, after which each participant is allowed to modify his or her forecast based on the shared information. This method is
Delphi.
A qualitative forecasting method which utilizes structured questionnaires submitted to potential customers soliciting opinions about potential products to estimate likely demand is
market surveys.
Which of the following statements about forecasts is true?
Forecasts are no substitute for calculated values.
Unpredictable movement of demand from one period to the next in a time series is
randomness.
Which of the following statements about forecasts is true?
Forecasts are almost always wrong.
Refrigerant R-12 was to be phased out as manufacturers switched systems to the environmentally friendly but more expensive GHG. Refrigeration repairmen consulted their forecasting models and unanimously concluded that they should stockpile R-12 while it was still affordable.These forecasting models could be classified as
price forecasts.
A qualitative forecasting method which utilizes individuals familiar with specific market segments, has them estimate the demand within these segments, and adds the forecasts together to get an overall forecast is
build-up forecasting.
Collaborative planning, forecasting, and replenishment systems perform many necessary supply chain processes. Which of the following typically does NOT fall under the scope of a CPFR system?
development of a layout and process choice
"Asset execution, job scheduling, and inventory stocking are most closely assocated with:
Short-range forecasts
Which of the following statements about forecasts is true?
Forecasts for the near term tend to be more accurate.
The situation is stable and historical data exists, as in the case of mature products or technologies. In this case, which of the following forecasting approachs is used?
quantitative method
One qualitative forecasting method bases the forecast for a new product or service on the actual sales history of a similar product or service. An example is forecasting demand for the newest model of iPod by using the demand history from the previous model of iPod. This method is
life cycle analogy.
"At the end of January, a hospital is preparing a forecast to estimate the number of patients for April. In January, it served 250 patients with a projected upward trend of 15 patients per month. What is the forecast patient demand in April?
295 patients
"During te first quarter last year Randy's Roach Coach served 120 gallons of gumbo. Total sales for the year were 320 gallons. If Randy projects total sales of 400 gallons next year, what is the forecast sales during the first quarter?.
150 gallons
"What is the basic assumption of Time Series forecasting?
Hstorical time series data are good predictors of the future.
"Which of the following is most closely associated with the Naive or Last Period forecast model?
It has the highest random variation of the time series forecastintg models. This is the correct answer.
"Which of the following is most closely associated with the Exponential Smoothing forecast model?
It is a form of a weighted moving average forecast model.
"Which of the following is a provides a measure of forecast error dispersion?
Mean Absolute Deviation.
"Prepare a trend adjusted exponential smoothing forecast for June given alpha = .4, beta = .3, AFSubscript May = 1600, FSubscript May = 1300, TSubscript May = 300, and the actual demand in May was 1500
1848
"Error metrics may indicate that the forecast model is producing poor results. What action may a manager take to remidy this problem?
Change forecast method to better match the demand pattern.
"Which of the followoing is most closely associated with data randomness?
unpredictable movement from one time period to the next.
One qualitative forecasting method uses experts working individually. The individual forecasts are shared among the group, after which each participant is allowed to modify his or her forecast based on the shared information. This method is
Delphi.