BUS 776 | Course Paper

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Stone Age Surfboards is a small manufacturer of two types of popular low-tide

surfboards, the Graystone and the Lava models. The manufacturing process consists of

two departments: fabrication and finishing. The fabrication department has 8 skilled

workers, each of whom works 9.25 hours per day. The finishing department has 5

workers, each of whom works a 6 -hour shift per day. Each pair of Graystone

surfboards requires 2.5 labor hours in the fabrication department and 2 labor hours in

finishing. The Lava model requires 4.2 labor-hours in fabrication and 3.6 labor-hours in

finishing. The company operates 6 days a week. It makes a per unit profit of $40 on the

Graystone model and $60 on the Lava model. The company anticipates selling at least

twice as many Lava models as Graystone models.

Use the spreadsheet below for Stone Age Surfboards to answer the following

question(s) using integer constraints on variables in the optimization models using the

standard Solver.

What is the total number of hours used for fabrication?

A) 39.6

B) 34.4

C) 29.2

D) 24.8

A company makes standard 130- inch-wide rolls of thin sheet metal and slits them into

smaller rolls to meet customer orders for widths of 10, 14, and 25 inches. Suppose that

the company has proposed the following cutting patterns:

Demands for the coming week are 950 10-inch rolls, 725 14-inch roles, and 640

25-inch rolls. Develop a model using the Analytic Solver Platform that will determine

how many 130-inch rolls to cut into each of the six patterns in order to meet demand

and minimize scrap.

What is the total number of 25-inch rolls produced?

A) 630

B) 635

C) 640

D) 645

Below is a spreadsheet for a hotel overbooking model.

Assume that each reservation has a constant probability p = 0.04 of being cancelled.

Answer the question(s) using the Risk Solver Platform.

With respect to B12, what is the range for values given in the Parameters section in the

Discrete dialog?

A) $E$2:$E$13

B) $D$2:$D$8

C) $D$2:$D$13

D) $E$2:$E$8

On an average, the number of students that choose to study Arts subjects at Greyin Tide

University is 17 each year. (Hint: Use Poisson distribution formula).

What is the probability that exactly 13 students will take up Arts in the coming year?

A) 0.08795

B) 0.20087

C) 0.04798

D) 0.06585

________ is a data-mining technique used for classifying a set of observations into

predefined classes.

A) Logistic regression

B) k-Nearest Neighbors algorithm

C) Discriminant analysis

D) Linear regression

Letherin Hides is a company that makes boots specifically targeting college students.

Forecasts of sales for the next year are 200 in the summer, 450 in the autumn, and 500

in the winter. Accessories that are used on the boots are purchased from a supplier for

$31.66. The cost of capital is estimated to be 24% per year (or 6% per quarter); thus, the

holding cost per item is 0.06($31.66) = $1.9 per quarter (rounded figure). Letherin

Hides hires freelance art designers at part-time to craft designs during the summer, and

they earn $ 6 per hour. In the autumn, labor is more difficult to keep, and the owner

must pay $6.5 per hour to retain qualified help. Because of the high demand for

part-time help during the winter holiday season, labor rates are higher in the winter, and

workers earn $7.75 per hour. Each boot design takes 2 hours to complete. How should

production be planned over the three quarters to minimize the combined production and

inventory holding costs?

The table below provides information on Letherin Hides boot design cost and

production.

According to the linear optimization model, what is the net production for autumn?

A) 200

B) 500

C) 450

D) 50

Howard has screened some employee details out of the employee database for tax

computation purposes. In order to restore the original data file, Howard must:

A) click Sort Newest to Oldest.

B) click Clear filter from Item Description.

C) click Unmerge cells.

D) click Clear outline from Ungroup.

Divisive clustering method is different from agglomerative clustering methods in that

divisive clustering methods ________.

A) can only have a pair of subjects in each cluster

B) separate objects into a particular cluster in one step

C) separate n objects successively into finer groupings

D) can only have a single subject in each cluster

Shirley Templeton is a real estate agent for Paralol Realty. Shirley is given the

responsibility to manage potential customers for 5 of the Realty’s bungalows. These 5

bungalows are situated in close proximity. In order to make traveling easier, Shirley

decides to move to a location closer to the 5 bungalows. The table below gives the

location (X and Y coordinates) of the 5 bungalows along with the number of trips she

would have to make to each bungalow. Create a nonlinear model based on the data

given in the table below noting that the objective is to reduce the weighted distance

between Shirley’s accommodation and the 5 bungalows.

According to the model, what is the distance between Shirley’s new accommodation

and Bungalow 4?

A) 14.53

B) 250.78

C) 54.62

D) 98.21

The Ransin Sports Company has noted that the size of individual customer orders is

normally distributed with a mean of $112 and a standard deviation of $9. Which of the

following is the answer for the probability that the next individual who buys a product

will make a purchase of more than $116?

A) 71%

B) 48%

C) 33%

D) 42%

Below is a spreadsheet for Trance Electronics.

Suppose that the project manager of Trance Electronics has identified the following

uncertain variables in the model and the distributions and parameters that describe

them, as follows: Market size: normal with mean of 20,000,000 units and standard

deviation of 4,000,000 units. R&D costs: uniform between $600,000,000 and

$800,000,000.

Clinical trial costs: lognormal with mean of $150,000,000 and standard deviation

$30,000,000. Annual market growth factor: triangular with minimum = 2%,

maximum = 6%, and most likely = 3%.

Annual market share growth rate: triangular with minimum = 15%, maximum =

25%, and most likely = 20%.

The number of trials per simulation is equal to 10,000 at a Sim. Random Seed of 2. Run

the simulation and answer the following questions using the Risk Solver Platform.

With reference to the trend chart, which year shows the highest mean net cumulative

profit?

A) Year 1

B) Year 2

C) Year 4

D) Year 5

The ________ indicates how much the value of the objective function will change as

the right-hand side of a constraint is increased by 1.

A) objective coefficient

B) shadow price

C) binding constraint

D) reduced cost

Dresden Pharmaceuticals has decided to go ahead and start clinical trials on a potential

new drug. The total R&D costs are estimated to reach around $875,000,000 with

clinical trials mounting to $145,000,000. The current market size is estimated to be

around 3,000,000 and is expected to grow at 4 percent every year. The market share

Dresden hopes to capture in the first year is 7 percent, and is projected to grow by 25

percent each year for the next 4 years. A monthly prescription is anticipated to generate

revenue of $420 while incurring variable costs of $150. A discount rate of 8 percent is

assumed.

Calculate the annual cost incurred for the second year.

A) $1,224,120,000

B) $884,520,000

C) $491,400,000

D) $638,820,000

A(n) ________ is a matrix whose rows correspond to decisions and whose columns

correspond to events.

A) decision tree model

B) payoff table

C) utility function table

D) scoring model

Which of the following is the equation for calculating the coefficient of variation (CV)?

A) CV = standard deviation/mean

B) CV = standard deviation – z-score/mean (total variation)

C) CV = value of observation’s distance from mean/standard deviation

D) CV = mean/(standard deviation)2

Qualis Investments is a private limited business that manages personal financial

portfolios. The company manages six mutual funds and has a client that has acquired

$750,000 from an inheritance. Characteristics of the funds are given in the table below.

The company recommends that no more than $300,000 be invested in any individual

fund, and that at least $80,000 be invested in each of the mid-cap stock and mortgage

fund. The total amount invested in the low-priced and multinational funds are at least

35% of the total investment. The client would like an average return of at least 6%.

Assume that X1- X6 represent the dollar amounts invested in funds 1 through 6,

respectively.

Which of the following is the constraint for investment in low-priced and multinational

funds?

A) X1 + X2 â‰¥ 0.35(750,000)

B) â‰¥ 0.35(750,000)

C) X1 + X2 + X3 + X4 + X5 + X6 â‰¥ 0.35(750,000)

D) â‰¥ 0.35