Quiz on Operations Management: Processes and Supply Chains

Operations Management: Processes and Supply Chains, 10e (Krajewski et al.)
Chapter 14 Forecasting

1) The repeated observations of demand for a product or service in their order of occurrence form a pattern known as a time series.
Answer: TRUE
Reference: Demand Patterns
Difficulty: Easy
Keywords: time series, repeated observations

2) One of the basic time series patterns is random.
Answer: TRUE
Reference: Demand Patterns
Difficulty: Easy
Keywords: time series, pattern, random

3) Random variation is an aspect of demand that increases the accuracy of the forecast.
Answer: FALSE
Reference: Demand Patterns
Difficulty: Easy
Keywords: random variation, forecast accuracy

4) Aggregation is the act of clustering several similar products or services.
Answer: TRUE
Reference: Key Decisions on Making Forecasts
Difficulty: Moderate
Keywords: aggregation, clustering

5) Aggregating products or services together generally decreases the forecast accuracy.
Answer: FALSE
Reference: Key Decisions on Making Forecasts
Difficulty: Moderate
Keywords: aggregation, forecast accuracy

6) Judgment methods of forecasting are quantitative methods that use historical data on independent variables to predict demand.
Answer: FALSE
Reference: Key Decisions on Making Forecasts
Difficulty: Moderate
Keywords: judgment method, forecast, historical data, qualitative methods
Learning Outcome: Describe major approaches to forecasting

7) Time-series analysis is a statistical approach that relies heavily on historical demand data to project the future size of demand.
Answer: TRUE
Reference: Key Decisions on Making Forecasts
Difficulty: Moderate
Keywords: time series, forecast, historical demand data
Learning Outcome: Describe major approaches to forecasting
8) The causal method of forecasting uses historical data on independent variables (such as promotional campaigns and economic conditions) to predict the demand of