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1K views4 pages

Multiple Choice Questions: This Activity Contains 15 Questions

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Raman Kulkarni
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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4/30/2020 Multiple Choice Questions

Home Chapter 4 Study Guide Multiple Choice Questions

Multiple Choice Questions

This activity contains 15 questions.

A market forecast will always be lower than the market potential due to the
fact that
The forecast time frames are different
Some of the potential market customers will not purchase due to timing, affordability,
and other conditions.
A market forecast is based on a company forecast while market potential is based on
an industry forecast
The size of the two markets differ
Market forecasts only include repeat purchases
Market potential only includes highly probable sales

At a corporate level, a sales forecast is used for:

Allocating resources across functional areas


Setting sales quotas
Changing commission pay schedules
Changing product warranty information
Developing local sales promotions
Modifying sales evaluation criteria

The naive sales forecasting method is based on this premise:

The forecast will be an average of the last two selling periods.


Applying seasonal index values.
The last three years' average results.
Sales will be based on the opinion of top executives in the company.
Data from the most recent sales period will be more heavily weighted.
Sales for the next period will be equal to sales in the last period.

Your company does not have any prior sales data and you have very little
time to set a forecast for your organization. Which forecasting method
would be most ideal?
Exponential Smoothing
Delphi Method
Moving Average
Jury of Executive Opinion
Test Market
Decomposition

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4/30/2020 Multiple Choice Questions

You want an easy-to-use sales forecasting method that can account for
seasonality. Which approach would be best under these circumstances?
Moving Averages
Delphi Method
Decomposition
Survey of Buyer Intentions
Test Market
Exponential Smoothing

You have five years of past sales data; however, there have been changes
to products and target market focus over the past few years when
compared to the previous period. What forecasting method would take this
into account and still be simple to use?
Exponential Smoothing
Delphi Method
Decomposition Method
Moving Averages
Regression Analysis
Straight Line Projection

The Exponential Smoothing method is most closely aligned to this sales


forecasting method:
Moving Averages
Time Series Regression
Test Market Method
Delphi Method
Sales Force Composite Method
Straight Line Projection

When choosing the best sales forecasting method, the most important
consideration would be:
What type of method your top competitor is using
The amount, quality, and stability of the data available
The risk tolerance of the senior management team
The trustworthiness of your sales team
How many customers you can survey
Whether you have at least 10 years worth of sales data

A key forecasting trend is

An increase in combining forecasting methods


An increase in the use of quantitative methods
The increased use of judgment input to overlay or adjust statistical forecasts.
The increased use of high-end computers to crunch past data and assign variables

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4/30/2020 Multiple Choice Questions

The inclusion of multiple managers to hide the blame if forecast is off


The increase in collaboration with competitors to improve the accuracy of forecasts

A key potential issue with the Sales Force Composite sales forecasting
method is:
Salespeople will have tendency to overestimate their sales forecast if rewards are tied
closely to achievement
Salespeople are by nature pessimistic about their ability to generate sales
Salespeople will have tendency to underestimate their sales forecast if rewards are
tied closely to achievement
Salespeople typically don't plan with their customers
Salespeople don't have enough customers to talk to
Salespeople don't have a good grasp of their previous sales results

This would be a key leading indicator that could be closely related to sales:

A change in economic conditions affecting a specific industry


The age of the company sales force
Whether the sales manager has a degree in economics
A change in the percentage of sales training done on line
The number of interviews used in the sales selection process
The increase in the number of customers in non-target market segments

The Test Market Method should be avoided when:

You want to gauge directly the level of customer acceptance for a new product
You want to test customer satisfaction levels
You want to test price sensitivity
You want to avoid "tipping your hand"
You want to gauge repeat purchase rates
You want to predict sales based on real market conditions

In order for the time-series regression method to be used, you need:

Population statistics
Seasonal Indices
Customer survey results
A buying power index
Many periods of data to plot
Census data available to plot

You want a sales forecasting method that can be conducted fairly quickly
and compensate for major strategic changes without giving the competition
a clear indication of your intentions. This method will tap into resources

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4/30/2020 Multiple Choice Questions

with sound knowledge of the key customer intentions. Which forecasting


method would best apply?
Survey of Buyer Intentions
Jury of Executive Opinion
Delphi Method
Test Market
Sales Force Composite
Decomposition method

The ideal order for conducting these 4 types of forecasts is:

Sales Forecast, Market Potential, Market Forecast, Sales Potential


Market Potential, Market Forecast, Sales Potential, Sales Forecast
Market Potential, Sales Potential, Market Forecast, Sales Forecast
Market Forecast, Market Potential, Sales Potential, Sales Forecast
Sales Potential, Market Potential, Sales Forecast, Market Forecast
Market Potential, Market Forecast, Sales Potential, Sales Forecast

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