Seasonal Indices

Calculate the seasonal index for a particular month if the actual value is 120, and the average value for that month over the years is 100.

• 150

• 1.2

• 2.5

• 0.8

If the seasonal index for a particular month is 1.2, what does it indicate about the sales or demand during that month?

• Equal to the average

• 20% higher than the average

• 50% higher than the average

• 10% lower than the average

Explain the concept of deseasonalizing data and why it is important in forecasting.

• Deseasonalizing data is important in forecasting, but it only focuses on the seasonal components of the data

• Deseasonalizing data is not important in forecasting as it does not affect the accuracy of predictions

• Deseasonalizing data is only important in short-term forecasting, not long-term forecasting

• Deseasonalizing data is important in forecasting because it allows for more accurate predictions by focusing on the non-seasonal components of the data.

What does a seasonal index of 0.8 indicate about the sales or demand during a particular month?

• 80% of the average sales or demand

• The sales or demand is 80% below average

• The sales or demand is 0.8 units

• 20% of the average sales or demand

Calculate the seasonal index for a particular quarter if the actual value is 500, and the average value for that quarter over the years is 450.

• 111.11

• 1.25

• 0.90

• 2.75

If the seasonal index for a particular quarter is 1.1, what does it indicate about the sales or demand during that quarter?

• 20% higher than the average

• 10% higher than the average

• 50% higher than the average

• 5% lower than the average

Discuss the impact of seasonal indices on inventory management for a retail business.

• Seasonal indices have no impact on inventory management

• Seasonal indices only apply to certain types of products

• Seasonal indices help in forecasting demand and adjusting inventory levels accordingly to meet customer needs during peak seasons.

• Seasonal indices are used to forecast employee scheduling instead of inventory levels

Explain how seasonal indices are used in adjusting historical data to make forecasts more accurate.

• By ignoring seasonal patterns in historical data

• By relying solely on historical data without any adjustments

• By using random numbers to adjust historical data

• By identifying and quantifying seasonal patterns in historical data, allowing for adjustments to be made in forecasting.

If the seasonal index for a particular quarter is 0.9, what does it indicate about the sales or demand during that quarter?

• Sales or demand is 110% of the average

• Sales or demand is 90% of the average

• Sales or demand is 0.5% of the average

• Sales or demand is 1.5 times the average

Calculate the seasonal index for a particular season if the actual value is 800, and the average value for that season over the years is 700.

• 1.14

• 0.5

• 2.5

• 0.75