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Home  arrow Chapter 5: Forecasting  arrow Self-Study Quizzes  arrow Multiple Choice

Multiple Choice



This activity contains 12 questions.

Question 1.
If one desires to make a prediction for a point in the distant future, the most appropriate technique is:


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Question 2.
If the actual value for the month of January was 120, and the forecast made for January was 112, what would be the forecast for February if we used a simple exponential smoothing with an α value of 0.3?


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Question 3.
The mean absolute deviation error (MAD) will always be:


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Question 4.
In picking an appropriate value for the smoothing constant (α) in a simple smoothing model, the objective is to___________.


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Question 5.
Given the following data, if MAD = 1.25, the actual demand in period 2 (A2) must have been

ch5_mc_5.gif


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Question 6.
The process of isolating linear trend and seasonal factors to develop more accurate forecasts is called:


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Question 7.
Positive tracking signals indicate a tendency of demand to __________.


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Question 8.

Average starting salaries for students using a placement service at a university have been steadily increasing. A study of the last four graduating classes indicates the following average salaries: $20,000, $22,000, $23,000, and $25,000 (last graduating class).

Predict the starting salary for the next graduating class using an exponential smoothing model with ch5_mc_8.gif = 0.2. Assume that the initial forecast was $20,000 (so that the forecast and the actual were the same).


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Question 9.
Demand for a particular type of battery fluctuates from one week to the next. A study of the last six weeks provides the following demands (in dozens): 4, 5, 3, 6, 7, 8 (last week).

Forecast demand during the next week using a two-week moving average.


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Question 10.
The MAD for the following forecast versus actual sales figures is

ch5_mc_10.gif


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Question 11.
Decomposition is


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Question 12.
Decomposition implies the disaggregation of a time series into:


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