Forcasting

Chapter 03

Forecasting

True / False Questions

1. Forecasting techniques generally assume an existing causal system that will continue to exist in the future. 

True    False

2. For new products in a strong growth mode, a low alpha will minimize forecast errors when using exponential smoothing techniques. 

True    False

3. Once accepted by managers, forecasts should be held firm regardless of new input since many plans have been made using the original forecast. 

True    False

4. Forecasts for groups of items tend to be less accurate than forecasts for individual items because forecasts for individual items don't include as many influencing factors. 

True    False

5. Forecasts help managers plan both the system itself and provide valuable information for using the system. 

True    False

6. Organizations that are capable of responding quickly to changing requirements can use a shorter forecast horizon and therefore benefit from more accurate forecasts. 

True    False

7. When new products or services are introduced, focus forecasting models are an attractive option. 

True    False

8. The purpose of the forecast should be established first so that the level of detail, amount of resources, and accuracy level can be understood. 

True    False

9. Forecasts based on time series (historical) data are referred to as associative forecasts. 

True    False

10. Time series techniques involve identification of explanatory variables that can be used to predict future demand. 

True    False

11. A consumer survey is an easy and sure way to obtain accurate input from future customers since most people enjoy participating in surveys. 

True    False

12. The Delphi approach involves the use of a series of questionnaires to achieve a consensus forecast. 

True    False

13. Exponential smoothing adds a percentage (called alpha) of last period's forecast to estimate next...