Exam-2-sample-for-fall-06-with-key

Exam-2-sample-for-fall-06-with-key - SAMPLE QUESTIONS...

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1 SAMPLE QUESTIONS REPRESENTATIVE OF THOSE TO BE USED IN EXAM 2 (revised 10-23-11) Pages 2-10 are multiple choice questions. Page 11 contains the multiple choice answer key. Pages 12 & 13 are a forecasting problem using exponential smoothing and seasonality, similar to the homework. The solutions for all numerical problems are on pages 14-16.
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2 1. Using the exponential smoothing formula (shown in the forecasting problem set at the end of this exam), an adjustment is made at the end of each time period to the smoothed forecast based upon the actual demand in the period just ended. In order to increase the formula’s responsiveness to actual demand, which action would be taken? a. Increase the value of F t b. Increase the value of alpha c. Change the value of F t+1 d. Decrease the value of alpha. e. Set the forecast equal to zero. 2. Cumulative forecast error is used to determine how well a forecast is tracking actual demand. One measure is an ongoing, algebraic sum of forecast errors (which some texts, but not ours, call the running sum of forecast errors—RSFE) . This running, algebraic sum is the numerator of the tracking signal . For a particular item’s forecast, you notice that the RSFE over the last few time periods has become an ever-larger negative number. (The formula for forecast error is A t – F t .) This means: a. that the forecast is consistently lower than demand b. that the forecast is consistently higher than demand c. nothing unless the RSFE equals zero d. that the forecast could be either higher or lower than demand e. none of the above 3. Another measure of forecast error is the mean absolute deviation of forecast errors—MAD (which is also the denominator of the tracking signaI ). This measure is best described as: a. the forecast error standard deviation b. the reciprocal of the RSFE c. a measure of the average error regardless of algebraic sign d. the error expressed as a percentage relative to the base forecast e. none of the above 4. Causal forecasting models are, generally, most useful for which of the following planning periods? I. short-range II. tactical/medium-range III. strategic/long-range a. I b. II c. III d. II & III e. All three
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3 In class, a triangle was utilized to illustrate the relationship between forecasting, planning, and execution. The next two questions refer to the following triangle: A ” represents forecasting B ” represents aggregate planning C ” represents execution. Assume that we are dealing with a consumer products company, like Proctor and Gamble. 5. At the bottom of the triangle at point A, a company is working in terms of a. aggregate (or total) output. b. detailed, daily schedules c. individual product statistical forecasts d. marketing intelligence e. orders from individual customers 6. Which of the following describes the activity that is being performed along the arrow labeled “D”? I.
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Exam-2-sample-for-fall-06-with-key - SAMPLE QUESTIONS...

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