A Manufacturer Can Simplify the Forecasting Process by Pooling Demand

question 358

Multiple Choice

A manufacturer can simplify the forecasting process by pooling demand forecasts for a product group and then:

• A) averaging total demand and spreading it evenly across all items.
• B) disaggregating demand to the item level based on marketing input.
• C) disaggregating demand to the item level based on historical proportions.
• D) allocating demand to each production site.

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Definitions:

Food, Conservation, and Energy Act

U.S. legislation enacted in 2008 aimed at governing a wide range of agricultural and food policies, including crop insurance and nutritional programs.

Target Price

A pre-set price determined by a company or government at which a product, especially in agriculture, is aimed to be sold in the market.

Countercyclical Payment

A fiscal mechanism used to reduce the economic fluctuations by providing economic support during downturns and less support during growth periods.

Price Supports

Government interventions to maintain the market price of a commodity or product at a certain level by buying excess supply or instituting price floors.