Answers

CHAPTER 4: FORECASTING

TRUE/FALSE

1. Tupperware only uses both qualitative and quantitative forecasting techniques, culminating in a final forecast that is the consensus of all participating managers.

False (Global company profile: Tupperware Corporation, moderate)

2. The forecasting time horizon and the forecasting techniques used tend to vary over the life cycle of a product.

True (What is forecasting? moderate)

3. Sales forecasts are an input to financial planning, while demand forecasts impact human resource decisions.

True (Types of forecasts, moderate)

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

False (Seven steps in the forecasting system, moderate)

5. Most forecasting techniques assume that there is some underlying stability in the system.

True (Seven steps in the forecasting system, moderate)

6. The sales force composite forecasting method relies on salespersons’ estimates of expected sales.

True (Forecasting approaches, easy)

7. A time-series model uses a series of past data points to make the forecast.

True (Forecasting approaches, moderate)

8. The quarterly "make meeting" of Lexus dealers is an example of a sales force composite forecast.

True (Forecasting approaches, easy)

9. Cycles and random variations are both components of time series.

True (Time-series forecasting, easy)

10. A naive forecast for September sales of a product would be equal to the sales in August.

True (Time-series forecasting, easy)

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

True (Time-series forecasting, moderate)

12. The larger the number of periods in the simple moving average forecasting method, the greater the method's responsiveness to changes in demand.

False (Time-series forecasting, moderate)

13. Forecast including trend is an exponential...