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Exam 4: Forecasting

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Question 51

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Taco Bell's unique employee scheduling practices are partly the result of using

A) point-of-sale computers to track food sales in 15 minute intervals
B) focus forecasting
C) a six-week moving average forecasting technique
D) multiple regression
E) A and C are both correct.

F) B) and C)
G) A) and E)

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Question 52

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List and briefly describe the three major types of forecasts.

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The three types are economic, technologi...

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Question 53

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If two variables were perfectly correlated, the correlation coefficient r would equal

Which of the following is true regarding the two smoothing constants of the Forecast Including Trend (FIT) model?

Forecasts of individual products tend to be more accurate than forecasts of product families.

For a given product demand, the time series trend equation is 53 - 4 X. The negative sign on the slope of the equation

In a regression equation where Y is demand and X is advertising, a coefficient of determination (R²) of .70 means that 70% of the variance in advertising is explained by demand.

The following trend projection is used to predict quarterly demand: Y = 250 - 2.5t, where t = 1 in the first quarter. Seasonal (quarterly) indices are Quarter 1 = 1.5; Quarter 2 = 0.8; Quarter 3 = 1.1; and Quarter 4 = 0.6. What is the seasonally adjusted forecast for the next four quarters?

A seasonal index for a monthly series is about to be calculated on the basis of three years' accumulation of data. The three previous July values were 110, 150, and 130. The average over all months is 190. The approximate seasonal index for July is

One advantage of exponential smoothing is the limited amount of record keeping involved.

The __________ measures the strength of the relationship between two variables.

Which of the following is not a type of qualitative forecasting?

The forecasting model that pools the opinions of a group of experts or managers is known as the

A management analyst is using exponential smoothing to predict merchandise returns at an upscale branch of a department store chain. Given an actual number of returns of 154 items in the most recent period completed, a forecast of 172 items for that period, and a smoothing constant of 0.3, what is the forecast for the next period? How would the forecast be changed if the smoothing constant were 0.6? Explain the difference in terms of alpha and responsiveness.

Demand forecasts, also called __________ forecasts, are projections of demand for a company's products or services.

A time series trend equation is 25.3 + 2.1 X. What is your forecast for period 7?

Patterns in the data that occur every several years are called circuits.

A firm has modeled its experience with industrial accidents and found that the number of accidents per year (Y) is related to the number of employees (X) by the regression equation Y = 3.3 + 0.049*X. R-Square is 0.68. The regression is based on 20 annual observations. The firm intends to employ 480 workers next year. How many accidents do you project? How much confidence do you have in that forecast?

__________ forecasts are concerned with rates of technological progress, which can result in the birth of exciting new products, requiring new plants and equipment.

Favors Distribution Company purchases small imported trinkets in bulk, packages them, and sells them to retail stores. They are conducting an inventory control study of all their items. The following data are for one such item, which is not seasonal. a. Use trend projection to estimate the relationship between time and sales (state the equation). b. Calculate forecasts for the first four months of the next year. $\begin{array} { | l | c | c | c | c | c | c | c | c | c | c | c | c | } \hline & 1 & 2 & 3 & 4 & 5 & 6 & 7 & 8 & 9 & 10 & 11 & 12 \\\hline \text { Month } & \text { Jan } & \text { Feb } & \text { Mar } & \text { Apr } & \text { May } & \text { Jun } & \text { Jul } & \text { Aug } & \text { Sep } & \text { Oct } & \text { Nov } & \text { Dec } \\\hline \text { Sales } & 51 & 55 & 54 & 57 & 50 & 68 & 66 & 59 & 67 & 69 & 75 & 73 \\\hline\end{array}$