Chapter 4

25 July 2022
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question
Which of the following statements is NOT true regarding‚Äč forecasting?
answer
Forecasting is exclusively an objective prediction.
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The forecasting time horizon that would typically be easiest to predict for would be the
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short range
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A forecast that addresses the business cycle by predicting planning indicators is
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an economic forecast.
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A forecast that projects a‚Äč company's sales is
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a demand forecast.
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CPFR is
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collaborative, planning,‚Äč forecasting, and replenishment.
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The goal of CPFR is to
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create significantly more accurate information that can power the supply chain.
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Which of the following statements is NOT‚Äč true?
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When excess capacity‚Äč exists, cost can decrease.
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Which of the following is the FIRST step in a forecasting‚Äč system?
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Determine the use of the forecast.
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Which of the following is the FINAL step in a forecasting‚Äč system?
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Validate and implement the results.
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Which of the following is a reality each company faces regarding its forecasting‚Äč system?
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Outside factors that we cannot predict or control often impact the forecast.
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Which of the following forecasting steps comes directly after determining the time horizon of the‚Äč forecast?
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Select the forecasting‚Äč model(s).
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Which of the following is a quantitative forecasting‚Äč method?
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exponential smoothing
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Which of the following is a qualitative forecasting‚Äč method?
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Delphi method
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Which forecasting model is based upon‚Äč salespersons' estimates of expected‚Äč sales?
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sales force composite
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Which of the following is NOT a‚Äč time-series model?
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multiple regression
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A tracking signal
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is a measurement of how well a forecast is predicting actual values
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A forecasting technique consistently produces a negative tracking signal. This means that
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the forecasting technique consistently‚Äč over-predicts.
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Forecasting that tries a variety of computer models and selects the best one for a particular application is referred as
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focus forecasting.
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Which one of the following statements is NOT true about the forecasting in the service‚Äč sector?
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Detailed forecasts of demand are not needed.
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What forecasting systems combine the intelligence of multiple supply chain‚Äč partners?
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CPFR
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A‚Äč six-month moving average forecast is generally better than a‚Äč three-month moving average forecast if‚Äč demand:
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is rather stable
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A forecast with a time horizon of about 3 months to 3 years is typically called‚Äč a:
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medium range forecast
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The fundamental difference between cycles and seasonality is‚Äč the:
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duration of the repeating patterns.
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Forecasts used for new product‚Äč planning, capital‚Äč expenditures, facility location or‚Äč expansion, and‚Äč R&D typically utilize‚Äč a:
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long-range time horizon.
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Which of the following techniques uses variables such as price and promotional‚Äč expenditures, which are related to product‚Äč demand, to predict‚Äč demand?
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associative models
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Gradual upward or downward movement of data over time is‚Äč called:
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a trend
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The three major types of forecasts used by organizations in planning future operations‚Äč are
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economic, technological, and demand.
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Which‚Äč time-series model below assumes that demand in the next period will be equal to the most recent‚Äč period's demand?
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‚Äčna√Įve approach
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When using exponential‚Äč smoothing, the smoothing constant
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can be determined using MAD.
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Which of the following values of alpha would cause exponential smoothing to respond the SLOWEST to forecast‚Äč errors?
answer
.10
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The primary purpose of the mean absolute deviation‚Äč (MAD) in forecasting is‚Äč to:
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measure forecast accuracy
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For a given product‚Äč demand, the‚Äč time-series trend equation is 53 minus‚ąí 4x. The negative sign on the slope of the‚Äč equation:
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is an indication that product demand is declining.
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A seasonal index for a monthly series is about to be calculated on the basis of three‚Äč years' accumulation of data. The three previous July values were‚Äč 110, 150, and 130. The average demand over all months during the‚Äč three-year time period was 190. What is the approximate seasonal index for‚Äč July?
answer
.684