OPMA CH. 3 Part 1

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? A. 5 % to 10 % B. 20 % to 50 % C. 20 % to 80 % D. 60 % to 120 % E. 90 % to 100 %

A

In general, which forecasting time frame compensates most effectively for random variation and short term changes? A. Short-term forecasts B. Quick-time forecasts C. Long range forecasts D. Medium term forecasts E. Rapid change forecasts

A

In most cases, demand for products or services can be broken into several components. Which of the following is considered a component of demand? A. Cyclical elements B. Future demand C. Past demand D. Inconsistent demand E. Level demand

A

The exponential smoothing method requires which of the following data to forecast the future? A. The most recent forecast B. Precise actual demand for the past several years C. The value of the smoothing constant delta D. Overall industry demand data E. Tracking values

A

Which of the following forecasting methodologies is considered a time series forecasting technique? A. Simple moving average B. Market research C. Leading indicators D. Historical analogy E. Simulation

A

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

A

A company wants to forecast demand using the weighted moving average. If the company uses two prior yearly sales values (i.e., year 2012 = 110 and year 2013 = 130), and we want to weight year 2012 at 10% and year 2013 at 90%, which of the following is the weighted moving average forecast for year 2014? A. 120 B. 128 C. 133 D. 138 E. 142

B

Given a prior forecast demand value of 1,100, a related actual demand value of 1,000, and a smoothing constant alpha of 0.3, what is the exponential smoothing forecast value? A. 1,000 B. 1,030 C. 1,070 D. 1,130 E. 970

B

Given a prior forecast demand value of 230, a related actual demand value of 250, and a smoothing constant alpha of 0.1, what is the exponential smoothing forecast value for the following period? A. 230 B. 232 C. 238 D. 248 E. 250

B

In business forecasting, what is usually considered a medium-term time period? A. Six weeks to one year B. Three months to two years C. One to five years D. One to six months E. Six months to six years

B

In most cases, demand for products or services can be broken into several components. Which of the following is considered a component of demand? A. Forecast error B. Autocorrelation C. Previous demand D. Consistent demand E. Repeat demand

B

Which of the following considerations is not a factor in deciding which forecasting model a firm should choose? A. Time horizon to forecast B. Product C. Accuracy required D. Data availability E. Analyst availability

B

Which of the following forecasting methodologies is considered a qualitative forecasting technique? A. Simple moving average B. Market research C. Linear regression D. Exponential smoothing E. Multiple regression

B

A company wants to forecast demand using the simple moving average. If the company uses four prior yearly sales values (i.e., year 2010 = 100, year 2011 = 120, year 2012 = 140, and year 2013 = 210), which of the following is the simple moving average forecast for year 2014? A. 100.5 B. 140.0 C. 142.5 D. 145.5 E. 155.0

C

A company wants to forecast demand using the simple moving average. If the company uses three prior yearly sales values (i.e., year 2011 = 130, year 2012 = 110, and year 2013 =160), which of the following is the simple moving average forecast for year 2014? A. 100.5 B. 122.5 C. 133.3 D. 135.6 E. 139.3

C

A company wants to forecast demand using the weighted moving average. If the company uses three prior yearly sales values (i.e., year 2011 = 160, year 2012 = 140 and year 2013 = 170), and we want to weight year 2011 at 30%, year 2012 at 30% and year 2013 at 40%, which of the following is the weighted moving average forecast for year 2014? A. 170 B. 168 C. 158 D. 152 E. 146

C

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 this 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

C

As a consultant you have been asked to generate a unit demand forecast for a product for year 2014 using exponential smoothing. The actual demand in year 2013 was 750. The forecast demand in year 2013 was 960. Using this data and a smoothing constant alpha of 0.3, which of the following is the resulting year 2014 forecast value? A. 766 B. 813 C. 897 D. 1,023 E. 1,120

C

If a firm produced a product that was experiencing growth in demand, the smoothing constant alpha (reaction rate to differences) used in an exponential smoothing forecasting model would tend to be which of the following? A. Close to zero B. A very low percentage, less than 10% C. The more rapid the growth, the higher the percentage D. The more rapid the growth, the lower the percentage E. 50 % or more

C

In general, which forecasting time frame is best to detect general trends? A. Short-term forecasts B. Quick-time forecasts C. Long range forecasts D. Medium term forecasts E. Rapid change forecasts

C

Which of the following forecasting methodologies is considered a causal forecasting technique? A. Exponential smoothing B. Weighted moving average C. Linear regression D. Historical analogy E. Market research

C

Which of the following forecasting methods uses executive judgment as its primary component for forecasting? A. Historical analogy B. Time series analysis C. Panel consensus D. Market research E. Linear regression

C

In business forecasting, what is usually considered a long-term time period? A. Three months or longer B. Six months or longer C. One year or longer D. Two years or longer E. Ten years or longer

D

In business forecasting, what is usually considered a short-term time period? A. Four weeks or less B. More than three months C. Six months or more D. Less than three months E. One year

D

In general, which forecasting time frame best identifies seasonal effects? A. Short-term forecasts B. Quick-time forecasts C. Long range forecasts D. Medium term forecasts E. Rapid change forecasts

D

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? A. Average demand for a period B. A trend C. Seasonal elements D. Past data E. Autocorrelation

D

In time series data depicting demand which of the following is not considered a component of demand variation? A. Trend B. Seasonal C. Cyclical D. Variance E. Autocorrelation

D

Which of the following forecasting methodologies is considered a time series forecasting technique? A. Delphi method B. Exponential averaging C. Simple movement smoothing D. Weighted moving average E. Simulation

D

Which of the following forecasting methods is very dependent on selection of the right individuals who will judgmentally be used to actually generate the forecast? A. Time series analysis B. Simple moving average C. Weighted moving average D. Delphi method E. Panel consensus

D

Which of the following is not one of the basic types of forecasting? A. Qualitative B. Time series analysis C. Causal relationships D. Simulation E. Force field analysis

E