MGTS 3301 Ch 18

In forecasting, there is more than one use for linear regression. What are they?

-Casual relationship forercasting -time series forecasting

If a firm produced a product where they were expecting growth, what alpha value would you expect them to use?

15 to 30

With market research, the data collection methods are primarily _____ and ______.

survey; interviews

Exponentially smoothed forecasts can be corrected somewhat from lagging by adding in a _____ adjustment.

trend

Which of the following is the formula for the intercept in simple regression?

y-bt

Weighted moving average and simple exponential soothing + exponential smoothing with trend

5 to 10 observations needed to start

_____ research is used mostly for product research in the sense of looking for new product ideas.

Market

What type of forecasts rely on the knowledge of experts and require judgment?

Qualative

forecasting techniques generally take advantage of the knowledge of experts and require much judgment.

Qualitative

Components of demand

Seasonal, Random, Trend

Forecasting model based upon merely average past demand

Simple moving average

Qualitative

Techniques that use managerial judgement

Simulation

These models allow the forecaster to run through a range of assumptions about the condition of the forecast.

_____ _____ is the most used of all forecasting techniques

exponential smoothing

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

highest

Considered when using a forecasting model

- Frim's degree of flexibility - consequence of a bad forecast

The smoothing constant values depend on which of the following?

- How steady the trend factor is - the variation in the demand

Identify the basic classifications of forecasting.

- Time series Analysis - Qualitative - Casual Relationships -Simulation

With exponential smoothing, the value for the constant is determined both by what?

- the nature of the product manager's sense of what constitutes a good response rate

Exponential smoothing forecasting model uses the following data

-smoothing constant alpha -most recent forecast -actual demand for most recent forecast period

Typically, fairly small values are used for alpha and delta in the range of what?

0.1 to 0.3

Linear regression

10 to 20 observations

Trend and seasonal models

2. to 3 observations per season

In the exponential smoothing method, how many pieces of information are needed to forecast the future?

3

If a firm produced a standard item with relatively stable demand, what alpha value in percentage points would you expect them to use?

5 to 10

Which type of seasonal variation assumes that the season amount is a constant?

Additive

Casual Forecasting

Assumes that demand is related to some underlying factor or factors in thee environment

Time series analysis

Based on the idea that data relating to past demand can be used to predict future demand

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

Casual relationship

Which of the following is not a forecast horizon used in forecasting?

Current

_____ factors are more difficult to determine because the time span may be unknown or the cause of the cycle may not be considered.

Cylical

When the most recent occurrences are more indicative of the future than those in the distant past, one should use which time series model?

Exponential

Which of the following is the formula for a single exponential smoothing?

Ft=Ft-1+α(At−1−Ft−1)

Which of the following qualitative techniques of forecasting forecasts demand for a new product using an existing or a generic product as a model?

Historical analogy

Time frame that refers to three months to two years

Medium

The values selected for alpha and delta depend on how much____ variation there is in demand and how _____ the trend factor is.

Random Steady

Usually, which word is associated with a period of the year characterized by some activity?

Seasonal

What term refers to the amount of correction needed in a time series to adjust for the season of the year?

Seasonal Factor

What term refers to the amount of correction needed in a time series to adjust for the season of the year?

Seasonal factor

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

Short Medium and Long

In general, the ____- ____ models compensate for random variation and adjust for changes over a brief period of time.

Short term

______ models are especially good for measuring the current variability in demand.

Short-term

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

Strategic

The exponentially smoothed trend for period t (Tt) includes the error between what two terms?

The previous forecast and previous forecast including trend

Which of the following is the formula for simple regression?

Yt=a+bt

In the formula for exponential smoothing α(At-1-Ft-1) represents

a portion of the error

Exponential smoothing forecasting models are surprisingly

accurate

The two types of seasonal variation discussed are _____ and _____.

additive and multiplicative

The main disadvantage of the moving average is

all individual data elements must be carried as data

If one variable changes because of the change in another variable, this is a _____ _____.

causal relationship

A simple moving average gives _____________ weight to each component of the forecast; whereas a weighted moving average gives ___________ weight to each element

equal; varying

Simple moving average

6 to 12 months; weekly data are often used

Fill in the blank question. When decisions in forecasting are at a broader, higher level (as when introducing a new product line or concerning strategic product decisions such as new marketing areas), the term ____ _____ is generally used.

executive judgment

To be of value for the purpose of forecasting, any independent variable must be a _____ indicator.

leading

Which qualitative forecasting technique is based upon the idea that a group of people with various backgrounds can develop a more reliable forecast than a narrower group?

Panel consensus

The longer the averaging period

the smother the plot

In trying to forecast demand for a new product, an ideal situation would be one where an existing product or a generic product could be used as a ______.

model

Qualitative techniques are most useful when the product is

new

The single exponential smoothing equation states that the _____ forecast is equal to the _____ forecast plus a portion of the ______.

new; old; error

As the moving average period ____becomes and _____ periods are used, there is more oscillation and there is a closer following of the trend.

shorter; fewer

A time series can be defined as chronologically ordered data that may contain one or more components of demand. What are these components?

trend, seasonal, cyclical, autocorrelation, and random

When calculating a multiplicative seasonal index, what mathematical operator is used to relate the trend and seasonal factor?

x

Which of the following is the formula for the slope in simple regression?

Σty−nt⋅yΣt2−nt2