Content Quiz 2: Forecasting (Module 2)

When a consistent mistake is made in a forecast, this is classified as __________ error.

Bias

Which of the following is not an example of a qualitative forecasting technique?

Causal methods

Which forecasting model incorporates independent variables other than time to predict future demand?

Causal relationship (models)

A forecast method which generates a higher overall MAD is better.

False

Longer averaging periods (bigger N) included in the simple moving average can enable a quick response to the recent demand change.

False

Simple exponential smoothing can be used to generate forecasts for demand with trend.

False

When choosing weights for a weighted moving average, the general rule states that the most recent periods should get the _________ weighting.

Highest

Which measurement of error measures the dispersion of some observed value from some expected value?

Mean absolute deviation

If an error cannot be explained by the forecast model being used, it is called __________ error.

Random

Tactical forecasts are __________ term, while strategic forecasts are __________ term.

Short; Medium and long

What type of forecast should be used for strategy, sourcing and location decisions?

Strategic

Qualitative forecasts are __________ while quantitative forecasts are __________.

Subjective; Numerical

hen you are trying to determine whether a forecast is keeping pace with changes in demand, you should use which measure?

Tracking signal

Lower alpha used in the exponential smoothing forecasting method can enable a smooth forecast with less severe peaks and valleys.

True

To deseasonalize the demand and find out the trend component in the demand pattern, one should divide the past demand data by seasonal factors.

True

When deciding which forecast model to use, a firm should consider all of the following except:

Weather

Which of the following is not a component of demand?

Planned