Question 1

Which of the following is NOT a way to measure forecasting errors?

Accepted Answer

A)  mean squared error (MS
E)  
B)  mean absolute deviation (MA
D)  
C)  mean absolute percentage error (MAP
E)  
D)  error sum of squares (SS
E)  E) A) and D)
F) A) and C)

Question 2

Which of the following is NOT a major component of a time series?

Accepted Answer

A)  seasonal variations
B)  trend line
C)  irregular variations
D)  best-fit lineE) None of the above
F) A) and C)

Question 3

Which of the following is NOT a measure of variation that must be calculated prior to determining the value of coefficient of determination (R²) ?

Accepted Answer

A)  total sum of squares (SST) 
B)  error sum of squares (SS
E)  
C)  regression sum of squares (SSR) 
D)  cumulative sum of error (CS
E)  E) B) and C)
F) All of the above

Question 4

______ is a short-term time series forecasting method in which forecasters assign more weight to most recent values in the time series if they feel that these values reflect how the actual demand will behave in the near future.

Accepted Answer

A)  Moving average
B)  Linear trend multiplicative method
C)  Weighted moving average
D)  Linear regression techniqueE) All of the above
F) B) and C)

Question 5

Which of the following statements is true about the coefficient of determination (R²) ?

Accepted Answer

A)  The higher the value of R²,the more confidence we have that the estimate is accurate.
B)  The lower the value of R²,the more confidence we have that the estimate is accurate.
C)  The value of R² has no significance on the accuracy of the estimate.
D)  The estimate is accurate when R² = 0.E) None of the above
F) A) and D) A

Question 6

Simple exponential smoothing or the first-order smoothing model can be used when ______.

Accepted Answer

A)  demand exhibits different types of trend patterns
B)  demand is constant or level
C)  demand exhibits both trend and seasonal patterns
D)  demand is fluctuatingE) C) and D)
F) All of the above

Question 7

______ variations are treated as outliers and are eliminated from consideration for forecasting purposes.

Accepted Answer

A)  Cyclical
B)  Seasonal
C)  Irregular
D)  RegularE) A) and C)
F) A) and B)

Question 8

The coefficient of determination has a value between ______.

Accepted Answer

A)  0 and 1
B)  -1 and +1
C)  -∞ to +∞
D)  -1 to 0E) None of the above
F) B) and D)

Question 9

The use of ______ involves establishing an upper and lower control limit to determine if the forecasting errors related to a method are within the limits.

Accepted Answer

A)  tracking signals
B)  control charts
C)  monitoring signals
D)  trend chartsE) C) and D)
F) B) and C) A

Question 10

______ is a predictive technique that models the relationship between a dependent variable and one or more independent variables.

Accepted Answer

A)  Linear regression analysis
B)  Linear trend multiplicative method
C)  Linear trend additive method
D)  Second-order or double smoothingE) B) and C)
F) C) and D)

Question 11

Which of the following statements is true about quantitative methods?

Accepted Answer

A)  They are appropriate for demand forecasting if there are causal relationships between explanatory variables.
B)  They cannot be used for short or medium-to-intermediate timeframes.
C)  They are used if measurable,historical data are not available.
D)  They are inappropriate for demand forecasting if there are causal relationships between explanatory variables.E) C) and D)
F) All of the above

Question 12

Which of the following models can be used when demand exhibits both trend and seasonal patterns?

Accepted Answer

A)  simple exponential smoothing
B)  second-order or double smoothing
C)  third-order or triple smoothing
D)  complex exponential smoothingE) B) and D)
F) A) and B)

Question 13

The independent variable in linear regression analysis is also referred to as the ______.

Accepted Answer

A)  predicted variable
B)  predictor variable
C)  random variable
D)  discrete variableE) B) and C)
F) A) and B)

Question 14

______ method results in a straight line that minimizes the sum of the squares of the differences between the line and each of the actual observations.

Accepted Answer

A)  Best-fit
B)  Straight-line
C)  Least-squares
D)  Linear-lineE) None of the above
F) A) and D)

Question 15

Which of the following is NOT an example of short-term time series forecasting methods?

Accepted Answer

A)  naïve approach
B)  moving averages
C)  exponential smoothing
D)  expert opinionE) A) and B)
F) All of the above

Question 16

Which of the following statements is false about trend patterns?

Accepted Answer

A)  Trend is the long-term movement of data over time.
B)  Damped trend occurs when the level of demand increases initially,but over the long run,it levels off.
C)  Exponential decline occurs when each succeeding observation decreases by some constant factor.
D)  Linear trend often occurs when new products are introduced.E) B) and D)
F) B) and C)

Question 17

Increased retail sales in December and peak demand for snow shovels during winter are examples of ______

Accepted Answer

A)  cyclical variations
B)  seasonal variations
C)  irregular variations
D)  random variationsE) C) and D)
F) A) and D)

Question 18

New forecast = [(α *latest observation) +((1 - α) * old forecast) ] is the formula for ______.

Accepted Answer

A)  moving average
B)  weighted moving average
C)  exponential smoothing
D)  factor rating methodE) A) and B)
F) None of the above C

Question 19

Product scheduling and worker assignments are examples of forecasted activities in ______ decision-making.

Accepted Answer

A)  operational
B)  tactical
C)  strategic
D)  functionalE) B) and D)
F) None of the above

Question 20

Exponential growth/decline are examples of ______.

Accepted Answer

A)  seasonal trend
B)  linear trend
C)  nonlinear trend
D)  damped trendE) A) and B)
F) All of the above

Exam 16: Demand Forecasting Methods

Which of the following is NOT a way to measure forecasting errors?

Correct AnswerverifiedShow Answer

Which of the following is NOT a major component of a time series?

Correct AnswerverifiedShow Answer

Which of the following is NOT a measure of variation that must be calculated prior to determining the value of coefficient of determination (R²) ?

Correct AnswerverifiedShow Answer

______ is a short-term time series forecasting method in which forecasters assign more weight to most recent values in the time series if they feel that these values reflect how the actual demand will behave in the near future.

Correct AnswerverifiedShow Answer

Which of the following statements is true about the coefficient of determination (R²) ?

Correct AnswerverifiedA

Simple exponential smoothing or the first-order smoothing model can be used when ______.

Correct AnswerverifiedShow Answer

______ variations are treated as outliers and are eliminated from consideration for forecasting purposes.

Correct AnswerverifiedShow Answer

The coefficient of determination has a value between ______.

Correct AnswerverifiedShow Answer

The use of ______ involves establishing an upper and lower control limit to determine if the forecasting errors related to a method are within the limits.

Correct AnswerverifiedA

______ is a predictive technique that models the relationship between a dependent variable and one or more independent variables.

Correct AnswerverifiedShow Answer

Which of the following statements is true about quantitative methods?

Correct AnswerverifiedShow Answer

Which of the following models can be used when demand exhibits both trend and seasonal patterns?

Correct AnswerverifiedShow Answer

The independent variable in linear regression analysis is also referred to as the ______.

Correct AnswerverifiedShow Answer

______ method results in a straight line that minimizes the sum of the squares of the differences between the line and each of the actual observations.

Correct AnswerverifiedShow Answer

Which of the following is NOT an example of short-term time series forecasting methods?

Correct AnswerverifiedShow Answer

Which of the following statements is false about trend patterns?

Correct AnswerverifiedShow Answer

Increased retail sales in December and peak demand for snow shovels during winter are examples of ______

Correct AnswerverifiedShow Answer

New forecast = [(α *latest observation) +((1 - α) * old forecast) ] is the formula for ______.

Correct AnswerverifiedC

Product scheduling and worker assignments are examples of forecasted activities in ______ decision-making.

Correct AnswerverifiedShow Answer

Exponential growth/decline are examples of ______.

Correct AnswerverifiedShow Answer

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A

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A

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New forecast = [(α latest observation) +((1 - α) old forecast) ] is the formula for ______.

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C

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