FARE 3310 Forecasting (Midterm 2 Review)

What are the 3 types of forecasts?

economic, technological, and demand

Which of the following is the correct sequence of steps in the forecasting process?

Determine the use of the forecast, select the items to be forecasted, determine the time horizon, select the forecasting model(s), gather the data needed, make the forecast, validate and implement results.

3 multiple choice options

What are the 4 qualitative methods of forecasting?

jury of executive opinion, delphi method, sales force composite, and consumer market survey

Which of the following best describes the qualitative "Jury of Executive Opinion" method?

It pools opinions from high-level experts and may incorporate statistical models

3 multiple choice options

What is the key feature of the Delphi method in forecasting?

It involves a panel of experts who provide feedback in multiple rounds

3 multiple choice options

What is the main feature of the "Sales Force Composite" method for forecasting?

It uses estimates from individual salespeople, which are reviewed and aggregated for reasonableness

3 multiple choice options

What is the primary approach used in the "Consumer Market Survey" method for forecasting?

Asking customers directly about their purchasing intentions

3 multiple choice options

What are the 5 types of quantitative approaches?

naive approach, moving averages, exponential smoothing, trend projection, linear regression

What are the components of demand?

trend, seasonal, cyclical and random

The _________ component of demand is a persistent, overall upward or downward pattern

trend

The __________ component of demand is a regular pattern of up and down fluctuations

seasonal

The __________ component of demand is repeating up and down movements affected by business cycle, political, and economic factors

cyclical

Cyclical component of demand usually has ________ or _______ relationships

casual, associative

The _______ component of demand has a short duration and is nonrepeating

random

Which quantitative approach is used if there is little or no trend, providing an overall impression of data over time?

moving average

3 multiple choice options

Which quantitative approach is used when older data is usually less important and some trend might be present?

weighted moving average

3 multiple choice options

What are some limitations of using the moving average approach for forecasting?

It is less sensitive to changes, does not forecast trends well, and requires extensive historical data.

3 multiple choice options

Which quantitative method weighs most recent data the heaviest, and involves little record keeping of past data?

exponential smoothing

3 multiple choice options

Which forecasting method uses several variables related to the quantity being predicted?

Associative forecasting methods

3 multiple choice options

The __________ measures how well the forecast is predicting actual values

tracking signal

True or false: good tracking signal has high values

false

1 multiple choice option

If forecasts are continually high or low, the forecast has a _______

bias error

___________ is a measurement of the total forecast error that assesses the bias in a forecast

CFE

A positive CFE indicates ______forecasting

under

A negative CFE indicates _____forecasting

over