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Exam 18: Forecasting

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Question 1

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A company wants to generate a forecast for unit demand for year 2014 using exponential smoothing.The actual demand in year 2013 was 120.The forecast demand in year 2013 was 110.Using these data and a smoothing constant alpha of 0.1, which of the following is the resulting year 2014 forecast value?

A) 100
B) 110
C) 111
D) 114
E) 120

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Question 2

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

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

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Question 3

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Time series forecasting models make predictions about the future based on analysis of past data.

RSFE in forecasting stands for "reliable safety function error."

Bayesian analysis is the simplest way to choose weights for the weighted moving average forecasting model.

A company has had actual unit demand for four consecutive years of 100, 110, 125, and 150.The respective forecasts using exponential smoothing were 120 for each of those four years.What value of alpha, the smoothing constant, was the firm using? ____________________________________

What does the text mean when it states that rather than to search for the perfect forecast one should learn to live with inaccurate forecasts?

In a forecasting model using simple exponential smoothing, the data pattern should remain stationary.

Simple exponential smoothing lags changes in demand.

Describe the collaborative planning, forecasting, and replenishment (CPFR) technique.

In most cases, demand for products or services can be broken into several components.Which of the following is considered a component of demand?

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?

In exponential smoothing, it is desirable to use a higher smoothing constant when forecasting demand for a product experiencing high growth.

Which of the following is a possible source of bias error in forecasting?

If you were selecting from a variety of forecasting models based on MAD, which of the following MAD values from the same data would reflect the most accurate model?

In business forecasting, what is usually considered a medium-term time period?

A company wants to forecast demand using the weighted moving average.If the company uses three prior yearly sales values , and we want to weight year 2011 at 30 percent, year 2012 at 30 percent, and year 2013 at 40 percent, which of the following is the weighted moving average forecast for year 2014?

You are using an exponential smoothing model for forecasting.The running sum of the forecast error statistics (RSFE) are calculated each time a forecast is generated.You find the last RSFE to be 34.Originally, the forecasting model used was selected because of its relatively low MAD of 0.4.To determine when it is time to re-evaluate the usefulness of the exponential smoothing model, you compute tracking signals.Which of the following is the resulting tracking signal?

Exponential smoothing forecasts always lag behind the actual occurrence but can be corrected somewhat with a trend adjustment.

In most cases, demand for products or services can be broken down into several components.Which of the following is not considered a component of demand?