Forecasting

Question 1

What is the primary focus of Chapter Five?

Answer 1

Learning objectives

The chapter outlines the objectives related to forecasting.

Question 2

What are the uses of forecasts?

Answer 2

Decision-making, planning, budgeting, and resource allocation

Forecasts help organizations prepare for future conditions.

Question 3

Name one feature common to all forecasts.

Answer 3

Uncertainty

All forecasts involve some level of uncertainty regarding future events.

Question 4

What are the time horizons for doing forecasts?

Answer 4

Short-term, medium-term, long-term

Different forecasts are made based on the time frame of interest.

Question 5

What is a requirement of an accurate forecast?

Answer 5

Quality data

Accurate forecasts rely on high-quality, relevant data.

Question 6

List the steps involved in forecasting.

Answer 6

• Define the problem
• Gather data
• Analyze data
• Develop the forecast
• Validate the forecast
• Implement and monitor

These steps ensure a structured approach to forecasting.

Question 7

What situational factors are important to consider in forecasting?

Answer 7

Market conditions, historical data, and technological changes

These factors can significantly influence the accuracy and relevance of forecasts.

Question 8

What are some reasons for ineffective forecasts?

Answer 8

Poor data quality, lack of understanding, and unexpected events

These issues can lead to inaccurate predictions and poor decision-making.

Question 9

What are the approaches to forecasting?

Answer 9

Qualitative, quantitative, and mixed methods

Different approaches may be used based on the context and available data.