FM015 PART B SET 1

2. Which of the following are feasible values for the correlation coefficient?

• 1 and 2 only
• 3 and 4 only
• 1, 2 and 4 only
• All the above

3. Freedie, a trader forecasts that its sales in the first month of 2017 will be $700,000 and will then grow at 5% per month for the next three months.It prices its products by adding a mark-up of 25% to its purchase cost. The retailer always carries sufficient inventory to cover the next month's forecast sales.What is the forecast inventory (to the nearest $) at the end of the second month of 2017?

(a)  

4. Profits have been as follows ($ m):

• 95
• 105
• -0.2
• 5

5. Which TWO of the following could be included in a time series based sales forecast?

• Index
• Seasonal variation
• Random fluctuation
• Cyclical variation

6. In a time-series analysis, the multiplicative model is used to forecast sales and the following seasonal variations apply.

• Cannot be determined
• Remained constant between quarter 1 and quarter 2
• Increased between quarter 1 and quarter 2
• Deceased between quarter 1 and quarter 2

7. A retailer forecasts the following data for the coming period:

• $385,000
• $390,000
• $365,000
• $410,000