Question 1

Heavy sales of umbrellas during a rainstorm is an example of which of the following?

Accepted Answer

A)   A trend
B)   A causal relationship
C)   A statistical correlation
D)   A coincidence
E)   A fadF) B) and D)
G) D) and E)

Question 2

A company wants to forecast demand using the simple moving average. If the company uses four prior yearly sales values , which of the following is the simple moving average forecast for year 2020?

Accepted Answer

A)   100.5
B)   140.0
C)   142.5
D)   145.5
E)   155.0F) B) and E)
G) A) and B)

Question 3

If the intercept value of a linear regression model is 40, the slope value is 40, and the value of X is 40, which of the following is the resulting forecast value using this model?

Accepted Answer

A)   120
B)   1,600
C)   1,640
D)   2,200
E)   64,000F) A) and B)
G) B) and D)

Question 4

If a firm produced a standard item with relatively stable demand, the smoothing constant alpha (reaction rate to differences)  used in an exponential smoothing forecasting model would tend to be in which of the following ranges?

Accepted Answer

A)   5 to 10 percent
B)   20 to 50 percent
C)   20 to 80 percent
D)   60 to 120 percent
E)   90 to 100 percentF) B) and D)
G) D) and E)

Question 5

Which of the following forecasting methodologies is considered a time series forecasting technique?

Accepted Answer

A)   Delphi method
B)   Exponential averaging
C)   Simple movement smoothing
D)   Weighted moving average
E)   SimulationF) D) and E)
G) B) and C)

Question 6

In the weighted moving average forecasting model, the weights must add up to one times the number of data points.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is not one of the basic types of forecasting?

Accepted Answer

A)   Qualitative
B)   Time series analysis
C)   Causal relationships
D)   Simulation
E)   Force field analysisF) A) and D)
G) B) and C)

Question 8

Decomposition of a time series means identifying and separating the time series data into its components.

Accepted Answer

A) True 
 B)False

Question 9

Exponential smoothing models are not very accurate.

Accepted Answer

A) True 
 B)False

Question 10

A company has actual unit demand for three consecutive years of 124, 126, and 135. The respective forecasts for the same three years are 120, 120, and 130. Which of the following is the resulting MAD value that can be computed from these data?

Accepted Answer

A)   1
B)   3
C)   5
D)   15
E)   123F) C) and E)
G) A) and D)

Question 11

A company wants to forecast demand using the simple moving average. If the company uses three prior yearly sales values , which of the following is the simple moving average forecast for year 2020?

Accepted Answer

A)   100.5
B)   122.5
C)   133.3
D)   135.6
E)   139.3F) A) and D)
G) A) and C)

Question 12

Autocorrelation means that the value expected at any point is highly correlated with its future values.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following forecasting methods can be used for short-term forecasting?

Accepted Answer

A)   Simple exponential smoothing
B)   Delphi technique
C)   Market research
D)   Hoskins-Hamilton smoothing
E)   Serial regressionF) A) and E)
G) A) and B)

Question 14

MAD statistics can be used to generate tracking signals.

Accepted Answer

A) True 
 B)False

Question 15

You are hired as a consultant to advise a small firm on forecasting methodology. Based on your research, you find the company has a MAD of 3. It wants to have a 99.7 percent control limits on its forecasting system. Its most recent tracking signal value is 15. What should be your report to the company?

Accepted Answer

A)   The forecasting model is operating acceptably.
B)   The forecasting model is out of control and needs to be corrected.
C)   The MAD value is incorrect.
D)   The upper control value is less than 20.
E)   The company is using an inappropriate forecasting methodology.F) A) and D)
G) B) and E)

Question 16

Which of the following forecasting methodologies is considered a qualitative forecasting technique?

Accepted Answer

A)   Simple moving average
B)   Market research
C)   Linear regression
D)   Exponential smoothing
E)   Multiple regressionF) A) and E)
G) All of the above

Question 17

Random errors can be defined as those that cannot be explained by the forecast model being used.

Accepted Answer

A) True 
 B)False

Question 18

A restriction in using linear regression is that it assumes that past data and future projections fall on or near a straight line.

Accepted Answer

A) True 
 B)False

Question 19

Trend lines are usually the last things considered when developing a forecast.

Accepted Answer

A) True 
 B)False

Question 20

Simple exponential smoothing lags changes in demand.

Accepted Answer

A) True 
 B)False

Exam 18: Forecasting

Autocorrelation means that the value expected at any point is highly correlated with its future values.

Correct Answer
verified

Exponential smoothing models are not very accurate.

Correct Answer
verified

A company wants to forecast demand using the simple moving average. If the company uses four prior yearly sales values , which of the following is the simple moving average forecast for year 2020?

Correct Answer
verified

If the intercept value of a linear regression model is 40, the slope value is 40, and the value of X is 40, which of the following is the resulting forecast value using this model?

Correct Answer
verified

Trend lines are usually the last things considered when developing a forecast.

Correct Answer
verified

Correct Answer
verified

Which of the following forecasting methodologies is considered a time series forecasting technique?

Correct Answer
verified

If a firm produced a standard item with relatively stable demand, the smoothing constant alpha (reaction rate to differences) used in an exponential smoothing forecasting model would tend to be in which of the following ranges?

Correct Answer
verified

A restriction in using linear regression is that it assumes that past data and future projections fall on or near a straight line.

Correct Answer
verified

Which of the following forecasting methodologies is considered a qualitative forecasting technique?

Correct Answer
verified

Random errors can be defined as those that cannot be explained by the forecast model being used.

Correct Answer
verified

A company wants to forecast demand using the simple moving average. If the company uses three prior yearly sales values , which of the following is the simple moving average forecast for year 2020?

Correct Answer
verified

Which of the following is not one of the basic types of forecasting?

Correct Answer
verified

In the weighted moving average forecasting model, the weights must add up to one times the number of data points.

Correct Answer
verified

Which of the following forecasting methods can be used for short-term forecasting?

Correct Answer
verified

Heavy sales of umbrellas during a rainstorm is an example of which of the following?

Correct Answer
verified

Simple exponential smoothing lags changes in demand.

Correct Answer
verified

A company has actual unit demand for three consecutive years of 124, 126, and 135. The respective forecasts for the same three years are 120, 120, and 130. Which of the following is the resulting MAD value that can be computed from these data?

Correct Answer
verified

MAD statistics can be used to generate tracking signals.

Correct Answer
verified

Decomposition of a time series means identifying and separating the time series data into its components.

Correct Answer
verified

Exam 18: Forecasting

Autocorrelation means that the value expected at any point is highly correlated with its future values.

Correct AnswerverifiedShow Answer

Exponential smoothing models are not very accurate.

Correct AnswerverifiedShow Answer

A company wants to forecast demand using the simple moving average. If the company uses four prior yearly sales values , which of the following is the simple moving average forecast for year 2020?

Correct AnswerverifiedShow Answer

If the intercept value of a linear regression model is 40, the slope value is 40, and the value of X is 40, which of the following is the resulting forecast value using this model?

Correct AnswerverifiedShow Answer

Trend lines are usually the last things considered when developing a forecast.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following forecasting methodologies is considered a time series forecasting technique?

Correct AnswerverifiedShow Answer

If a firm produced a standard item with relatively stable demand, the smoothing constant alpha (reaction rate to differences) used in an exponential smoothing forecasting model would tend to be in which of the following ranges?

Correct AnswerverifiedShow Answer

A restriction in using linear regression is that it assumes that past data and future projections fall on or near a straight line.

Correct AnswerverifiedShow Answer

Which of the following forecasting methodologies is considered a qualitative forecasting technique?

Correct AnswerverifiedShow Answer

Random errors can be defined as those that cannot be explained by the forecast model being used.

Correct AnswerverifiedShow Answer

A company wants to forecast demand using the simple moving average. If the company uses three prior yearly sales values , which of the following is the simple moving average forecast for year 2020?

Correct AnswerverifiedShow Answer

Which of the following is not one of the basic types of forecasting?

Correct AnswerverifiedShow Answer

In the weighted moving average forecasting model, the weights must add up to one times the number of data points.

Correct AnswerverifiedShow Answer

Which of the following forecasting methods can be used for short-term forecasting?

Correct AnswerverifiedShow Answer

Heavy sales of umbrellas during a rainstorm is an example of which of the following?

Correct AnswerverifiedShow Answer

Simple exponential smoothing lags changes in demand.

Correct AnswerverifiedShow Answer

A company has actual unit demand for three consecutive years of 124, 126, and 135. The respective forecasts for the same three years are 120, 120, and 130. Which of the following is the resulting MAD value that can be computed from these data?

Correct AnswerverifiedShow Answer

MAD statistics can be used to generate tracking signals.

Correct AnswerverifiedShow Answer

Decomposition of a time series means identifying and separating the time series data into its components.

Correct AnswerverifiedShow Answer

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