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Exam 8: Demand Management and Forecasting

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Question 1

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Menchie's Landscaping service routinely provides lawn fertilization services to their customers.It has been forecasted that they will be fertilizing 250 customer lawns in the upcoming season.Each lawn requires an average of 20 lbs.of fertilizer.What term can be used to describe the demand for the fertilizer?

A) Sporadic demand
B) Independent demand
C) Co-variance demand
D) Dependent demand

E) B) and D)
F) A) and D)

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Question 2

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Seasonal indices can be used to de-seasonalize demand or incorporate seasonality into a forecast.

A) True
B) False

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Question 3

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What is the demand pattern that can be used to describe the sales of General Motor's mid-size sedan model car that shows a general fluctuation in sales from month to month?

In the case of positive bias,people tend to

The Fresh Express Beverage Company is interested in evaluating the effects of advertising spend on the sales of their products.Based on historical data,they develop the following equation which approximates this relationship: y = 2.5 + 0.02x,where y is the number of bottles of beverages sold measured in millions of units,and x = amount of money spent on advertising measured in millions of dollars.Based on this information,which of the following statements is correct?

In forecasting,what is the Mean Absolute Deviation (MAD) ?

An assertion about the future whose outcome you have not yet seen is called a ________.

The Mean Absolute Deviation (MAD)is equal to the square root of the Mean Squared Error (MSE).

What will be the forecast for the month of October using an exponential smoothing technique and a smoothing constant of 0.2,if the demand during the months of August and September was 200 and 220 respectively and the forecast for the month of August was 180?

Which of the following forecast error measures will help determine whether or not there is a bias in a forecast?

The bullwhip effect indicates that the variation in demand will be higher with the retailer as compared to the manufacturer in a supply chain.

A moving average forecast is more responsive to changes in the historical demand when a higher value of n is used-i.e. ,when more demand periods are used in computing the forecast.

An advantage of the weighted moving average technique is that recent demand periods can be given more importance than older demand periods.

Which forecasting method is commonly used by going to the market to get information for new product launches?

Forecasting techniques such as moving averages and exponential smoothing represent smoothed (averaged)values of the historical time series data.

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

If a pattern appears like cycles or seasonality when a dependent variable is plotted against time,one should use time series analysis instead of regression analysis.

Which of the following is not a step in the forecasting process?

The measure of forecasting error that tells the average error in a forecast is known as ________.

In the context of demand management,the loss and replacement of customers is known as ________.