Operations Management
13th Edition
ISBN: 9781259667473
Author: William J Stevenson
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 3, Problem 32P
A manager has just receded an valuation from an analyst on two potential
a. What would cause the analyst to reach this conclusion?
b. What information can you add to enhance the analysis?
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Practice Problem:
Usins the data on a hospital’s revenue:
(1) Use simple exponential smoothing to make predictions for the hospital’s revenues during the next four quarters with α = 0.30.
(2) Use Trend-Adjusted Exponential Smoothing(i.e. Holt’s method) to make forecasts for the hospital’s revenues during the next four quarters. Assume α = 0.05, β = 0.65, initial revenue forecast = 1209285.75 and initial trend forecast = 15714.
(3) Using least-squares regression with seasonal index decomposing method, forecast the hospital’s revenues during the next four quarters.
Forecasting time horizons include:a) long range. b) medium range.c) short range. d) all of the choices.
A forecast is, basically, a prediction, or guess. Business people would like the prediction to be as accurate as possible, however it is still a guess about something that will happen in the future. Consider then, the nature and characteristics of forecasting.
What do you think the difficulties or obstacles to accurate forecasting might be? Submit and explain as many of these difficulties as you can think of.
Chapter 3 Solutions
Operations Management
Ch. 3.15 - Prob. 1.1RQCh. 3.15 - Prob. 1.2RQCh. 3.15 - Prob. 1.3RQCh. 3 - What are the main advantage that quantitative...Ch. 3 - What are some of the consequences of poor...Ch. 3 - List the specific weaknesses of each of these...Ch. 3 - Forecasts are generally wrong a. Why are forecasts...Ch. 3 - What is the purpose of establishing control limits...Ch. 3 - What factors would you consider in deciding...Ch. 3 - Contrast the use of MAD and MSE in evaluating...
Ch. 3 - What advantages as a forecasting tool does...Ch. 3 - How does the number of periods in a moving average...Ch. 3 - What factors enter into the choice of a value for...Ch. 3 - Prob. 11DRQCh. 3 - Explain how using a centered moving average with a...Ch. 3 - Contrast the terms sales and demand.Ch. 3 - Contrast the reactive and proactive approaches to...Ch. 3 - Explain how flexibility in production systems...Ch. 3 - How is forecasting in the context of a supply...Ch. 3 - Which type of forecasting approach, qualitative or...Ch. 3 - Prob. 18DRQCh. 3 - Choose the type of forecasting technique (survey,...Ch. 3 - Explain the trade-off between responsiveness and...Ch. 3 - Who needs to be involved in preparing forecasts?Ch. 3 - How has technology had an impact on forecasting?Ch. 3 - It has been said that forecasting using...Ch. 3 - What capability would an organization have to have...Ch. 3 - When a new business is started, or a patent idea...Ch. 3 - Discuss how you would manage a poor forecast.Ch. 3 - Omar has beard from some of his customers that...Ch. 3 - Give three examples of unethical conduct involving...Ch. 3 - A commercial baker, has recorded sales (in dozens)...Ch. 3 - National Scan, Inc., sells radio frequency...Ch. 3 - A dry cleaner uses exponential smoothing to...Ch. 3 - An electrical contractors records during the last...Ch. 3 - A cosmetics manufacturer s marketing department...Ch. 3 - Prob. 6PCh. 3 - Freight car loadings ova a 12-year period at a...Ch. 3 - Air travel on Mountain Airline for the past 18...Ch. 3 - a. Obtain the linear trend equation for the...Ch. 3 - After plotting demand for four periods, an...Ch. 3 - A manager of a store that sells and installs spas...Ch. 3 - The following equation summarizes the trend...Ch. 3 - Compute seasonal relatives for this data the SA...Ch. 3 - A tourist center is open on weekends (Friday,...Ch. 3 - The manager of a fashionable restaurant open...Ch. 3 - Obtain estimates of daily relatives for the number...Ch. 3 - A pharmacist has been monitoring sales of 2...Ch. 3 - New car sales for a dealer in Cook County,...Ch. 3 - The following table shows a tool and die companys...Ch. 3 - An analyst must decide between two different...Ch. 3 - Two different forecasting techniques (F1 and F2)...Ch. 3 - Two independent methods of forecasting based on...Ch. 3 - Long-Life Insurance has developed a linear model...Ch. 3 - Timely Transport provides local delivery service...Ch. 3 - The manager of a seafood restaurant was asked to...Ch. 3 - The following data were collected during a study...Ch. 3 - Lovely Lawns Inc., intends to use sales of lawn...Ch. 3 - The manager of a travel agency has been using a...Ch. 3 - Refer to the data in problem 22 a. Compute a...Ch. 3 - The classified department of a monthly magazine...Ch. 3 - A textbook publishing company has compiled data on...Ch. 3 - A manager has just receded an valuation from an...Ch. 3 - A manager uses this equation to predict demand for...Ch. 3 - A manager uses a trend equation plus quarterly...Ch. 3 - ML MANUFACTURING ML Manufacturing makes various...Ch. 3 - ML MANUFACTURING ML Manufacturing makes various...Ch. 3 - HIGHLINE FINANCIAL SERVICES, LTD. Highline...
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.Similar questions
- The Baker Company wants to develop a budget to predict how overhead costs vary with activity levels. Management is trying to decide whether direct labor hours (DLH) or units produced is the better measure of activity for the firm. Monthly data for the preceding 24 months appear in the file P13_40.xlsx. Use regression analysis to determine which measure, DLH or Units (or both), should be used for the budget. How would the regression equation be used to obtain the budget for the firms overhead costs?arrow_forwardThe owner of a restaurant in Bloomington, Indiana, has recorded sales data for the past 19 years. He has also recorded data on potentially relevant variables. The data are listed in the file P13_17.xlsx. a. Estimate a simple regression equation involving annual sales (the dependent variable) and the size of the population residing within 10 miles of the restaurant (the explanatory variable). Interpret R-square for this regression. b. Add another explanatory variableannual advertising expendituresto the regression equation in part a. Estimate and interpret this expanded equation. How does the R-square value for this multiple regression equation compare to that of the simple regression equation estimated in part a? Explain any difference between the two R-square values. How can you use the adjusted R-squares for a comparison of the two equations? c. Add one more explanatory variable to the multiple regression equation estimated in part b. In particular, estimate and interpret the coefficients of a multiple regression equation that includes the previous years advertising expenditure. How does the inclusion of this third explanatory variable affect the R-square, compared to the corresponding values for the equation of part b? Explain any changes in this value. What does the adjusted R-square for the new equation tell you?arrow_forwardb. Compute the MSE for each set of forecasts. Given your results, which forecast appears to be more accurate? (Round your answers to 2 decimal places.) MSE F1 ? % MSE F2 ? % F1 or F2 or none appears to be more accurate. d. Compute MAPE for each data set. Which forecast appears to be more accurate? (Round your intermediate calculations to 2 decimal places and and final answers to 2 decimal places.) MAPE F1 ? % MAPE F2. ? %arrow_forward
- an estimate that was very close to the actual time of arrival. Considering these factors are essentiel informed estimates by the entrepreneur. Since the business he/she is venturing hasn't started vet o important that these factors affecting forecasting will be determined to better help him/her in making the best decisions for the business. B: Semantic Web Directions: Read the notes sent to your group chat entitled "Factors affecting forecasting revenues " then explain each factor using the semantic web below. o eong YA Processing Question: 1. Why is it important for an entrepreneur to determine the factors affecting forecasting revenues?arrow_forwardNote:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forwardCinema HD an online movie streaming service that offers a wide variety of award-winning TV shows, movies, animes, and documentaries, would like to determine the mathematical trend of memberships in order to project future needs. Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 Membership 17 16 16 21 20 20 23 25 24 a. What are the issues associated with qualitative forecasting, and how are these overcome? b.Provide an example of qualitative forecasting and explain the shortcomings.arrow_forward
- 1. Figure 8.90 shows summer air visibility measurements for Denver, Colorado. The acceptable visibility standard is 100, with readings above 100 indicating clean air and good visibility, and readings below 100 indicating temperature inversions caused by forest fires, volcanic eruptions, or collisions with comets. Figure 8.9 Summer Air Visibility Measurements Visibility rating 250 225 200 175 150 125 100 75 50- 25 0 Year 2 Year 1 22 25 28 31 3 July 6 9 12 15 18 21 24 27 30 Date Augustarrow_forwardes Problem 3-21 (Algo) Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Actual demand and the two sets of forecasts are as follows: Period Demand 12345678 75 PREDICTED DEMAND F2 64 62 70 68 万 70 74 69 2 80 78 3437 72 F1 62 66 71 67 67 77 31228060 73 76 79 79arrow_forwardChoose one qualitative forecasting technique from the following. a. Regression analysis O b. Market research O c. Trend analysis o d. Naive forecastarrow_forward
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