Question

1) When operating a business, a manager should only use one forecasting technique at a time.
Yes or No?

2) Quarterly demand for a product includes both a trend and seasonality. The trend portion of deseasonalized demand is forecast based on a linear trend, yt = 50 + 4t, while the quarterly seasonal relatives are Q1 = 1.2, Q2 = 1.1, Q3 = 0.95 and Q4 = 0.75. What is the forecast demand for t = 11 and t = 12 given that these periods are third and fourth quarters in the time series.

3)Which correlation coefficient indicates the lowest strength of relationship between a variable of interest and an independent (predictor) variable?
a) –0.75
b) −0.50
c) 0.10
d) 0.25

4) What is the primary difference between seasonal and cyclical variation in a time series?

a) Seasonal has less variation.
b) Cyclical has less variation.
c) The vertical difference between peaks and troughs in the time series.
d) The length of the duration between peaks.

5) What area of a business organization would most likely use forecasts for revisions of current features or new designs of products or services?
a) Accounting
b) Operations
c) Product/service design
d) Human resources

Answer 1

1. YES

2. y(t) =50 +4 *11= 94 if t=11

y(t) =50+4*12 =98 if t=12

3. -0.75 ( the range of coefficent correlation is always lies between -1 and +1. A value of the correlation coefficient close to +1 indicates a strong positive linear relationship ,A value close to -1 indicates a strong negative linear relationship)

4. d) The length of the duration between peaks.

  seasonal time series are sometimes called periodic time series.

A cyclic pattern exists when data exhibit rises and falls that are not of fixed period.

5 d) Human resources