Ch. 5 Modeling Concept
If the multiplicative decomposition model is used to forecast daily sales for a retail store, how many seasons will there be? a) 4 b) 7 c) 12 d) 365
b) 7
Qualitative forecasting models include: a.) regression analysis b) Delphi c) time-series mode d) trend lines
b) Delphi
Which of the following is NOT a component of a time series? a) seasonality b) causal variations c) trend d) random variations
b) causal variations
In exponential smoothing, if you wish to give a significant weight to the most recent observations, then the smoothing constant should be: a) close to 0 b) close to 1 c) close to 0.5 d) less than the error
b) close to 1
Sales for a company are typically higher in the summer months than in the winter months. This variation would be called a: a) trend b) seasonal factor c) random factor d) cyclical factor
b) seasonal factor
If both trend and seasonal components are present in a time-series, then the seasonal indices: a) should be computed based on an overall average b) should be computed based on CMAs c) will be greater than 1 d) should be ignored in developing the forecast
b) should be computed based on CMAs
Which of the following may be negative? a) MAD b) bias c) MAPE d) MSE
bias
An exponential smoothing forecast with a smoothing constant of 1 would result in the same forecast as: a) a trend line forecast b) an exponential smoothing forecast with a smoothing constant of 0 c) a naive method d) a 2-period moving average forecast
c) a naive method
Which of the following is used to alert the user of a forecasting model that a significant error occurred in one of the periods? a) a seasonal index b) a smoothing constant c) a tracking signal d) a regression coefficient
c) a tracking signal
If the seasonal index for January is 0.80, then: a) January sales tend to be 80% higher than an average month b) January sales tend to be 20% higher than an average month c) January sales tend to be 80% lower than an average month d) January sales tend to be 20% lower than an average month
d) January sales tend to be 20% lower than an average month
A trend equation is a regression equation in which: a) there are multiple independent variables b) the intercept and the slope are the same c) the dependent variable is time d) the independent variable is time
d) the independent variable is time
When comparing several forecasting models to determine which one best fits a particular set of data, the model that should be selected is the one: a) with the highest MSE b) with the MAD closest to 1 c) with a bias of 0 d) with the lowest MAD
d) with the lowest MAD
Which of the following is a time-series model? a) the Delphi model b) regression analysis c) exponential smoothing d) multiple regression
exponential smoothing
One example of a causal model is: a) exponential smoothing b) trend projections c) moving averages d) regression analysis
regression analysis
A forecasting model that only uses historical data for the variable being forecast is called a a) time-series mode b) causal model c) Delphi model d) variable model
time-series model
