Reference no: EM132296209

True or false

1. Single exponential smoothing has the shortcoming of lagging changes in demand.

2. Random errors can be defined as those that cannot be explained by the forecast model being used.

3. When forecast errors occur in a normally distributed pattern, the ratio of the mean absolute deviation to the standard deviation is 2 to 1, or 2 x MAD = 1 standard deviation.

4. Often leading indicators are not causal relationships, but in some indirect way, they may suggest that some other things might happen.

5. Without probabilities and payoffs, a decision tree is not capable of generating a solution.

6. The capacity utilization rate is found by dividing best operating level by capacity used.

7. The objective of strategic capacity planning is to provide an approach for determining the overall capacity level of labor-intensive resources.

8. The problem of keeping demand sufficiently high to keep a large factory busy is a sales issue and not a diseconomy of scale.

9. Making adjustments to eliminate the variance between planned and actual output is tied into intermediate range capacity planning.