OM 300 Test 2 UA Nunnelly | UPDATED Questions with 100%
Verified Answers
Question: What is forecasting?
Answer:
The art and science of predicting future events- takes into account historical data and projects forward; -Can be
subjective or objective
Question: 3 Forecasting Time Horizons and their differences
Answer:
-Short Range Forecast: usually less than 3 months, More mathematical techniques (Moving averages,
Exponential smoothing, trend extrapolation) -Medium Range Forecast: falls between 3 months to 3 years; Sales
Planning, Production Planning, Budgeting -Long Range Forecast: 3+ years, Capital Expenditures, New
Products, Expansion
Question: 7 steps to Forecasting
Answer:
1. Determine Use - Disney-Park attendance drive staffing, opening, ride availability and food 2. Select items to
be forecasted -Forecasting attendance at each park 3. Time Horizon -Disney develops daily, weekly, monthly,
annual and 5-year forecasts 4. Which Models -moving avgs, econometrics, regression 5. Gather Data
-Forecasting team survey 1M visitors and use Global Insights 6.Make Forecast 7.Validate and implement
results -Error measures applied to make sure data is valid
Question: Qualitative Forecasting Approach
Answer:
Vaugue approach, little to no historical data exists, Intuition, experience
Question: Jury of Executive Opinion
Answer:
small group of executives and managers combine experience and statistical methods
Question: Delphi Method
Answer:
Iterative group process continues until a consensus is reached (Staff--> decision makers-->respondents)
Question: Sales Force Composite
Answer:
, Sales people forecast their sales on a regional level and then combine to nationals levels
Question: Consumer Market Survey
Answer:
Ask the customer!
Question: Quantitative Approach
Answer:
Stable approach, historical data exists, more mathematical techniques
Question: -Naive approach -moving averages -exponential smoothing -trend projection
Answer:
What are the four Time series Models?
Question: Naive approach
Answer:
-Qualitative approach that assumes demand in next period is the same as demand in most recent period. -Good
because realistic -Bad because seasons could change affecting demand
Question: Moving Averages
Answer:
-Qualitative approach used if little or no trend, used often for smoothing -good because it helps with no trend
Question: Weighted Moving Averages
Answer:
-Qualitative Approach used if some trend is present -apply weights to put more emphasis on recent values;
weights selected via intuition and experience -bad: forecast is less sensitive to changes and it does not forecast
trends well; can require extensive historical data
Question: Exponential Smoothing
Answer:
Verified Answers
Question: What is forecasting?
Answer:
The art and science of predicting future events- takes into account historical data and projects forward; -Can be
subjective or objective
Question: 3 Forecasting Time Horizons and their differences
Answer:
-Short Range Forecast: usually less than 3 months, More mathematical techniques (Moving averages,
Exponential smoothing, trend extrapolation) -Medium Range Forecast: falls between 3 months to 3 years; Sales
Planning, Production Planning, Budgeting -Long Range Forecast: 3+ years, Capital Expenditures, New
Products, Expansion
Question: 7 steps to Forecasting
Answer:
1. Determine Use - Disney-Park attendance drive staffing, opening, ride availability and food 2. Select items to
be forecasted -Forecasting attendance at each park 3. Time Horizon -Disney develops daily, weekly, monthly,
annual and 5-year forecasts 4. Which Models -moving avgs, econometrics, regression 5. Gather Data
-Forecasting team survey 1M visitors and use Global Insights 6.Make Forecast 7.Validate and implement
results -Error measures applied to make sure data is valid
Question: Qualitative Forecasting Approach
Answer:
Vaugue approach, little to no historical data exists, Intuition, experience
Question: Jury of Executive Opinion
Answer:
small group of executives and managers combine experience and statistical methods
Question: Delphi Method
Answer:
Iterative group process continues until a consensus is reached (Staff--> decision makers-->respondents)
Question: Sales Force Composite
Answer:
, Sales people forecast their sales on a regional level and then combine to nationals levels
Question: Consumer Market Survey
Answer:
Ask the customer!
Question: Quantitative Approach
Answer:
Stable approach, historical data exists, more mathematical techniques
Question: -Naive approach -moving averages -exponential smoothing -trend projection
Answer:
What are the four Time series Models?
Question: Naive approach
Answer:
-Qualitative approach that assumes demand in next period is the same as demand in most recent period. -Good
because realistic -Bad because seasons could change affecting demand
Question: Moving Averages
Answer:
-Qualitative approach used if little or no trend, used often for smoothing -good because it helps with no trend
Question: Weighted Moving Averages
Answer:
-Qualitative Approach used if some trend is present -apply weights to put more emphasis on recent values;
weights selected via intuition and experience -bad: forecast is less sensitive to changes and it does not forecast
trends well; can require extensive historical data
Question: Exponential Smoothing
Answer:
