ONE YIELD EXAM 2 ALL CHAPTER 18, ALL CHAPTER
14, ALL CHAPTER 11
Which of the following is not one of the "number of interesting issues that arise in yield
management?" - Answer -Designing yield management programs that cannot be
imitated by a competitor
Acceptance sampling is performed on goods that already exist to determine what
percentage of items conforms to specifications.
T/F? - Answer -t
A process flowchart uses which of the following symbols to represent a decision point in
a flow diagram? - Answer -Diamond
Which of the following forecasting methodologies is considered a time series forecasting
technique? - Answer -Weighted moving average
As a consultant you have been asked to generate a unit demand forecast for a product
for year 2014 using exponential smoothing. The actual demand in year 2013 was 750.
The forecast demand in year 2013 was 960. Using this data and a smoothing constant
alpha of 0.3, which of the following is the resulting year 2014 forecast value?
A. 766
B. 813
C. 897
D. 1,023
E. 1,120 - Answer -C
A company has actual unit demand for three consecutive years of 124, 126, and 135.
The respective forecasts for the same three years are 120, 120, and 130. Which of the
following is the resulting MAD value that can be computed from this data?
A. 1
B. 3
C. 5
,D. 15
E. 123 - Answer -C
A company has actual unit demand for four consecutive years of 100, 105, 135, and
150. The respective forecasts were 120 for all four years. Which of the following is the
resulting MAD value that can be computed from this data?
A. 2.5
B. 10
C. 20
D. 22.5
E. 30 - Answer -C
If you were selecting from a variety of forecasting models based on MAD, which of the
following MAD values from the same data would reflect the most accurate model?
A. 0.2
B. 0.8
C. 1.0
D. 10.0
E. 100.0 - Answer -A
A company has calculated its running sum of forecast errors to be 500 and its mean
absolute deviation is exactly 35. Which of the following is the company's tracking
signal?
A. Cannot be calculated based on this information
B. About 14.3
C. More than 35
D. Exactly 35
,E. About 0.07 - Answer -B
Which of the following is a possible source of bias error in forecasting?
A. Failing to include the right variables
B. Using the wrong forecasting method
C. Employing less sophisticated analysts than necessary
D. Using incorrect data
E. Using standard deviation rather than MAD - Answer -A
Which of the following are used to describe the degree of error?
A. Weighted moving average
B. Regression
C. Moving average
D. Forecast as a percent of actual
E. Mean absolute deviation - Answer -E
A company has a MAD of 10. Its wants to have a 99.7 percent control limits on its
forecasting system. It's most recent tracking signal value is 3.1. What can the company
conclude from this information?
A. The forecasting model is operating acceptably
B. The forecasting model is out of control and needs to be corrected
C. The MAD value is incorrect
D. The upper control value is less than 20
E. It is using an inappropriate forecasting methodology - Answer -A
You are hired as a consultant to advise a small firm on forecasting methodology. Based
on your research you find the company has a MAD of 3. Its wants to have a 99.7
, percent control limits on its forecasting system. It's most recent tracking signal value is
15. What should be your report to the company?
A. The forecasting model is operating acceptably
B. The forecasting model is out of control and needs to be corrected
C. The MAD value is incorrect
D. The upper control value is less than 20
E. The company is using an inappropriate forecasting methodology - Answer -B
Which of the following is the portion of observations you would expect to see lying within
a plus or minus 3 MAD range?
A. 57.05 percent
B. 88.95 percent
C. 98.36 percent
D. 99.85 percent
E. 100 percent - Answer -C
Which of the following is the portion of observations you would expect to see lying within
a plus or minus 2 MAD range?
A. 57.04
B. 89.04
C. 98.33
D. 99.86
E. 100.00 - Answer -B
If the intercept value of a linear regression model is 40, the slope value is 40, and the
value of X is 40, which of the following is the resulting forecast value using this model?
14, ALL CHAPTER 11
Which of the following is not one of the "number of interesting issues that arise in yield
management?" - Answer -Designing yield management programs that cannot be
imitated by a competitor
Acceptance sampling is performed on goods that already exist to determine what
percentage of items conforms to specifications.
T/F? - Answer -t
A process flowchart uses which of the following symbols to represent a decision point in
a flow diagram? - Answer -Diamond
Which of the following forecasting methodologies is considered a time series forecasting
technique? - Answer -Weighted moving average
As a consultant you have been asked to generate a unit demand forecast for a product
for year 2014 using exponential smoothing. The actual demand in year 2013 was 750.
The forecast demand in year 2013 was 960. Using this data and a smoothing constant
alpha of 0.3, which of the following is the resulting year 2014 forecast value?
A. 766
B. 813
C. 897
D. 1,023
E. 1,120 - Answer -C
A company has actual unit demand for three consecutive years of 124, 126, and 135.
The respective forecasts for the same three years are 120, 120, and 130. Which of the
following is the resulting MAD value that can be computed from this data?
A. 1
B. 3
C. 5
,D. 15
E. 123 - Answer -C
A company has actual unit demand for four consecutive years of 100, 105, 135, and
150. The respective forecasts were 120 for all four years. Which of the following is the
resulting MAD value that can be computed from this data?
A. 2.5
B. 10
C. 20
D. 22.5
E. 30 - Answer -C
If you were selecting from a variety of forecasting models based on MAD, which of the
following MAD values from the same data would reflect the most accurate model?
A. 0.2
B. 0.8
C. 1.0
D. 10.0
E. 100.0 - Answer -A
A company has calculated its running sum of forecast errors to be 500 and its mean
absolute deviation is exactly 35. Which of the following is the company's tracking
signal?
A. Cannot be calculated based on this information
B. About 14.3
C. More than 35
D. Exactly 35
,E. About 0.07 - Answer -B
Which of the following is a possible source of bias error in forecasting?
A. Failing to include the right variables
B. Using the wrong forecasting method
C. Employing less sophisticated analysts than necessary
D. Using incorrect data
E. Using standard deviation rather than MAD - Answer -A
Which of the following are used to describe the degree of error?
A. Weighted moving average
B. Regression
C. Moving average
D. Forecast as a percent of actual
E. Mean absolute deviation - Answer -E
A company has a MAD of 10. Its wants to have a 99.7 percent control limits on its
forecasting system. It's most recent tracking signal value is 3.1. What can the company
conclude from this information?
A. The forecasting model is operating acceptably
B. The forecasting model is out of control and needs to be corrected
C. The MAD value is incorrect
D. The upper control value is less than 20
E. It is using an inappropriate forecasting methodology - Answer -A
You are hired as a consultant to advise a small firm on forecasting methodology. Based
on your research you find the company has a MAD of 3. Its wants to have a 99.7
, percent control limits on its forecasting system. It's most recent tracking signal value is
15. What should be your report to the company?
A. The forecasting model is operating acceptably
B. The forecasting model is out of control and needs to be corrected
C. The MAD value is incorrect
D. The upper control value is less than 20
E. The company is using an inappropriate forecasting methodology - Answer -B
Which of the following is the portion of observations you would expect to see lying within
a plus or minus 3 MAD range?
A. 57.05 percent
B. 88.95 percent
C. 98.36 percent
D. 99.85 percent
E. 100 percent - Answer -C
Which of the following is the portion of observations you would expect to see lying within
a plus or minus 2 MAD range?
A. 57.04
B. 89.04
C. 98.33
D. 99.86
E. 100.00 - Answer -B
If the intercept value of a linear regression model is 40, the slope value is 40, and the
value of X is 40, which of the following is the resulting forecast value using this model?
