In each of the following, name the term defined or answer the question. Answers are listed at the bottom.
1. This is a type of forecast used to make long-term decisions, such as where to locate a warehouse or how many employees to have in a plant next year.
2. These are the six major components of demand.
3. This type of analysis is most appropriate when the past is a good predictor of the future.
4. This is identifying and separating time series data into components of demand.
5. If the demand in the current week was 102 units and we had forecast it to be 125, what would be next week’s forecast using an exponential smoothing model with an alpha of 0.3?
6. Assume you are using exponential smoothing with an adjustment for trend. Demand is increasing at a very steady rate of about five units per week. Would you expect your alpha and delta parameters to be closer to one or zero?
7. Your forecast is, on average, incorrect by about 10 percent. The average demand is 130 units. What is the MAD?
8. If the tracking signal for your forecast was consistently positive, you could then say this about your forecasting technique.
9. What would you suggest to improve the forecast described in question 8?
10. You know that sales are greatly influenced by the amount your firm advertises in the local paper. What forecasting technique would you suggest trying?
11. What forecasting tool is most appropriate when closely working with customers dependent on your products?