Operations Management, Global Edition 12Th Edition By William Stevenson – Test Bank
Chapter 03
Forecasting
True / False Questions
1. | Forecasting techniques generally assume an existing causal system that will continue to exist in the future. |
2. | For new products in a strong growth mode, a low alpha will minimize forecast errors when using exponential smoothing techniques. |
3. | Once accepted by managers, forecasts should be held firm regardless of new input since many plans have been made using the original forecast. |
4. | Forecasts for groups of items tend to be less accurate than forecasts for individual items because forecasts for individual items don’t include as many influencing factors. |
5. | Forecasts help managers both to plan the system itself and to provide valuable information for using the system. |
6. | Organizations that are capable of responding quickly to changing requirements can use a shorter forecast horizon and therefore benefit from more accurate forecasts. |
7. | When new products or services are introduced, focus forecasting models are an attractive option. |
8. | The purpose of the forecast should be established first so that the level of detail, amount of resources, and accuracy level can be understood. |
9. | Forecasts based on time-series (historical) data are referred to as associative forecasts. |
10. | Time-series techniques involve the identification of explanatory variables that can be used to predict future demand. |