Deck 9: Forecasting and Demand Planning

Question 1

A tracking signal provides a method for monitoring a forecast by quantifying _____.

A) bias
B) throughput
C) probability
D) validity

Answer 1

bias

Question 2

In the Delphi method of judgmental forecasting,_____.

A) predictions are based on the assumption that the future will be an extrapolation of the past
B) predictions are based on one or more independent variables,all of which are numerical
C) people from outside an organization are not eligible to make predictions
D) experts are not consulted as a group to make predictions

Answer 2

experts are not consulted as a group to make predictions

Question 3

Forecasting is a key component in customer relationship management.

Answer 3

True

Question 4

Judgmental forecasting relies upon historical data in developing forecasts.

Question 5

_____ is based on the assumption that the future will be an extrapolation of the past.

A) Judgmental forecasting
B) Statistical forecasting
C) The Delphi method
D) The Cooke method

Question 6

In the context of causal forecasting models with multiple regression,an R-squared (R²)value of 0.70 means that 30 percent of the variation in the dependent variable is explained by the independent variable.

Question 7

Call center service training is a preproduction service that requires forecasts to create value in a value chain.

Question 8

Alex,a manager at Symbic Inc.,plotted the company's total energy costs of 1 billion dollars over the past 10 years on a chart.The chart suggested that the energy costs appear to be increasing in a fairly predictable linear fashion and that the energy costs are related to time by a linear function Y_t =3+5t,where Y_t represents the estimate of the energy cost in year t.Given the equation,which of the following is the value of the intercept of the straight line that best fits the time series?

A) 1
B) 3
C) 5
D) 10

Question 9

_____ is a common approach to gather data for judgmental forecasts.

A) A moving average model
B) Regression analysis
C) A survey questionnaire
D) Single exponential smoothing

Question 10

Forecast _____ is the difference between the observed value of the time series and the forecast.

A) error
B) consumption
C) precision
D) density

Question 11

A _____ is the underlying pattern of growth or decline in a time series.

A) trend
B) planning horizon
C) forecast error
D) bias

Question 12

In the context of data patterns in a time series,a(n)_____ variation is a one-time variation that is explainable.

A) cyclical
B) random
C) irregular
D) seasonal

Question 13

In the context of data patterns in a time series,_____ are characterized by repeatable periods of ups and downs over short periods of time.

A) random variations
B) seasonal patterns
C) cyclical patterns
D) irregular variations

Question 14

If the time series in an exponential smoothing model exhibits a negative trend,the _____.

A) mean square error will be negative
B) value of smoothing constant will either be less than zero or greater than one
C) forecast will overshoot the actual values
D) future forecasts will rely solely upon expertise of people in developing forecasts

Question 15

Moving average (MA)methods work best when:

A) a long planning horizon is involved.
B) a cyclical pattern is observed in a time series.
C) demand is relatively stable and consistent.
D) there is a major trend in a time series.

Question 16

In the context of demand planning,customers' wants and needs define the customer benefit package.

Question 17

When no historical data are available,_____ is the sole basis for predicting future demands.

A) statistical forecasting
B) regression analysis
C) judgmental forecasting
D) exponential smoothing

Question 18

_____ is a forecasting technique that uses a weighted average of past time-series values to forecast the value of the time series in the next period.

A) A moving average forecast
B) Single exponential smoothing
C) A grassroots forecast
D) Regression analysis

Question 19

In the context of forecasting,the term _____ refers to the tendency of forecasts to consistently be larger or smaller than the actual values of the time series.

A) trend
B) bias
C) fad
D) variability

Question 20

A moving average (MA)method is most appropriate for data with major identifiable trends.

Question 21

In the context of data patterns in a time series,regular patterns in a data series that take place over long periods of time are called _____ patterns.

A) orthographic
B) seasonal
C) cyclical
D) parallel patterns

Question 22

In the context of a fairly stable time series with relatively little random variability,which of the following statements is true of single exponential smoothing (SES)?

A) Values of the smoothing constant larger than 0.5 place more emphasis on recent data.
B) Exponential smoothing models completely forget past data if the smoothing constant is strictly between 0 and 1.
C) Typical values for the smoothing constant are in the range of 1 to 1.5.
D) Values of the smoothing constant smaller than 0.1 allow a forecast to react faster to changing conditions.

Question 23

An exponential smoothing model must have a smoothing constant (α)_____ to be roughly equivalent to a moving average model with a seven-month moving average.

A) less than or equal to 0.10
B) more than 0.10 but less than or equal to 0.15
C) more than 0.15 but less than or equal to 0.20
D) more than 0.20

Question 24

In the context of forecasting errors,_____ eliminates the measurement scale factor.

A) normalized mean signed deviation
B) mean absolute deviation
C) normalized root mean square error
D) mean absolute percentage error

Question 25

_____ is a method for building a statistical model that defines a relationship between a single dependent variable and one or more independent variables,all of which are numerical.

A) The Delphi method
B) Regression analysis
C) Judgmental forecasting
D) The Cooke method

Question 26

_____ are used by operations managers to plan production schedules and assign workers to jobs.

A) Balanced scorecards
B) Intermediate-range forecasts
C) Short-range forecasts
D) Credit scorecards

Question 27

_____ are needed to plan workforce levels,allocate budgets among divisions,and schedule jobs and resources.

A) Make-to-order operations
B) Intermediate-range forecasts
C) Short-range forecasts
D) Make-to-stock operations