Solver can generate a Sensitivity report for integer models.
Point estimates do not provide any indication of the magnitude of the potential error in
the estimate.
A good regression model has the fewest number of explanatory variables providing an
adequate interpretation of the dependent variable.
If the alternative hypothesis includes the symbol <, the rejection region is in the upper
tail.
An increase in adjusted R2 indicates that the regression model has improved.
Fewer groups provide a “coarser” histogram.
A service level is a constraint that represents the probability that demand can be
satisfied.
The complexity of a problem increases when the problem belongs to an individual
rather than a group.
The larger the variance, the more the data are spread out from the mean.
When interpreting sensitivity analysis information for changes in model parameters, all
other model parameters are held constant.
The first step in a chi-square test is to compute the observed frequency between each
cell of the cross-tabulation if the two variables are independent.
The first step in a chi-square test is to compute the observed frequency between each
cell of the cross-tabulation if the two variables are independent.
Two variables can only have a statistical relationship if there is a cause-and-effect factor
between them.
The simple random sampling method is the only statistical sampling method that does
not include sampling errors.
Solver can generate a Sensitivity report for integer models.
How many additional dummy variables are required if a categorical variable has 4
levels?
A) 2
B) 3
C) 1
D) 4
Which of the following is a continuous random variable?
A) the outcomes of rolling two dice
B) the time to complete a specific task
C) the number of new hires in a year
D) the number of hits on a Web site link
Following is an extract from the database of a construction company. The table shows
the height of walls in feet and the cost of raising them. The estimated simple linear
regression equation is given as Ŷ = b0 + b1X. (Hint: Use Excel functions).
What is the estimated cost of raising a 10-inch wall?
A) 1505.786
B) 1103.578
C) 968.6109
D) 1123.008
Below is the spreadsheet for Memphis Designs fixed cost model:
Which of the following constraints is used in Solver?
A) $B$14:$D$14 > = $B$18:$D$18
B) $B$16:$D$16 = binary
C) $B$19:$D$19 < = $B$8:$D$8
D) $B$15:$D$15 = binary
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.
What is the expected loss ratio obtained from the simulation results of the net present
value?
A) 93.50%
B) 72.45%
C) 67.32%
D) 86.32%
The function returns a value or reference of the cell at the intersectionof a particular
row and column in a given range.
A) VLOOKUP(lookup_value, table_array, col_index_num)
B) INDEX(array, row_num, col_num)
C) MATCH(lookup_value, lookup_array, match_type)
D) HLOOKUP(lookup_value, table_array, row_index_num)
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.
Which of the following years shows the first profit for Dresden’s new drug?
A) first year
B) second year
C) third year
D) fourth year
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 5?
A) 54.62
B) 25.08
C) 14.53
D) 91.16
Which of the following would be considered a lagging measure in a restaurant using the
cause-and-modeling method of data mining?
A) a manager who is having trouble meeting the daily demands
B) a waiter’s behavior toward a customer
C) an accurately billed meal
D) a satisfied customer
Following is an extract from the Cost per Order Database of Grogtes LLC.
Which of the following does the 38th percentile of the costs per order indicate?
A) 62% of the costs per order are more than or equal to $190.40.
B) 38% of the costs per order are less than or equal to $189.20.
C) 62% of the costs per order are less than or equal to $484.16.
D) 38% of the costs per order are more than or equal to $501.80.
The difference between the first and third quartiles is referred to as the ________.
A) standard deviation
B) variance
C) interquartile range
D) midrange
A trader who wants to predict short-term movements in stock prices is likely to use
________ analytics.
A) predictive
B) descriptive
C) normative
D) prescriptive
Consider the following spreadsheet for an outsourcing decision model.
We assume that the production (demand) volume is normally distributed with a mean of
1,000 and a standard deviation of 100. For the unit cost, select the triangular
distribution. It has a minimum value of $150, most likely value of $165, and a
maximum value of $190. The number of trials per simulation is equal to 5,000 at a Sim.
Random Seed of 1. Run the simulation and answer the following question(s) using the
Risk Solver Platform.
What is the value of mean obtained from the simulation results? [Hint: Choose the
nearest answer]
A) $18,385
B) $21,608
C) $14,894
D) $23,946
Fiberia Accessories, a clothing retailer, is planning to introduce a new line of sweaters
as part of the winter collection for $65 with an inventory of 1500. The main selling
season is 60 days between November and December. The store then sells the remaining
units in a clearance sale at 65 percent discount. Out of the 60 main retail days, Fiberia
sells the sweaters at full retail price for only 45 days, while giving a discount of 25
percent for the remaining 15 days. The demand functions a, and b are given as 79.5 and
1.1 respectively.
Calculate the revenue for the clearance sales period.
A) $18,921.09
B) $23,400
C) $48,871.88
D) $17,105.16
Categorical variables that have been coded are called _______.
A) limited dependent variables
B) dummy variables
C) instrumental variables
D) observable variables
Which of the following is true of the value of k in the k-Nearest Neighbors algorithm?
A) The value of k is always taken as a constant and is equal to 1.
B) If the value of k is large, it drastically increases variability.
C) If the value k is very large, it introduces biases into the classification decisions.
D) If the value k is large, the classification of a record is very sensitive to the
classification of the single record to which it is closest.
Skewness describes the lack of symmetry of data.
Below is the spreadsheet for Memphis Designs fixed cost model:
What is the net production at the end of the first quarter?
A) 75
B) 200
C) 450
D) 600
Give the logical function for the following: If cell B7 equals 12, check contents of cell
B10. If cell B10 is 10, then the value of the function in the string is YES; if not, it is a
blank space. If cell B7 does not equal 12, then the value of the function is 7.
A) =IF(B7=12,(AND(B10=10, “”)(YES)),7)
B) =IF(B10=10,(OR(B7=12,””)”YES”)7)
C) =IF(B7=12,(IF(B10=10,”YES”, “”)),7)
D) =IF(B7=12,(AND(B10=10,”YES”,””)(B10=”NO”),7)
Coppell Services contracts with outsourcing partners to handle various customer service
functions. Based on a study of call volumes provided by one of the firm’s partners, the
minimum number of staff needed for each hour of the day is as follows:
Mr. Coppell hires 6 permanent employees and wants to staff the remaining
requirements using part-time employees who work 4-hour shifts (four consecutive
hours starting as early as 8 A.M. or as late as 1 P.M.).
How many part-time employees are present in the 3-4 time slot?
A) 16
B) 14
C) 9
D) 7
Which of the following 2010 Excel functions computes the p-value for the chi-square
test?
A) CHISQ.INV.RT
B) CHIDIST
C) CHI.SQ
D) CHISQ.TEST
The Riviera Transport Company (RTC) produces car accessories at two plants: Dallas
and Atlanta. They ship them to major distribution centers in Houston, San Jose,
Jacksonville, and Memphis. The accounting, production, and marketing departments
have provided the information in the table below, which shows the unit cost of shipping
between any plant and distribution center, plant capacities over the next planning
period, and distribution center demands. RTC’s supply chain manager faces the problem
of determining how much to ship between each plant and distribution center to
minimize the total transportation cost, not exceed available capacity, and meet customer
demand.
Assume Xij = amount shipped from plant i to distribution center j, where i = 1
represents Dallas, i = 2 represents Atlanta, j = 1 represents Houston, and so on.
According to the transportation model, what is the amount shipped from Atlanta to
Memphis?
A) 480
B) 0
C) 230
D) 950
What is the mean absolute deviation obtained from the simulation results?
A) 39.10
B) 24.56
C) 58.75
D) 46.36
The Blue Sunset Band is planning to record a new album. A major decision to be made
is if the band can record the album on their own, or if they should hire a studio to record
it with. The
fixed cost for recording at the studio is $100,000 plus the manufacturing cost per CD,
which is at
$250. If they record the album in-house, the cost per CD is $350. They plan to produce
3000 copies of the album regardless of the place of recording. The band plans to record
with the cheaper option. Below is the spreadsheet of the Recording Decision.
Using the spreadsheet below, provide the steps in using Excel formulas in finding the
cost of the first order for Item number 1345, and the total cost of all Item numbers
1345, using the
MatchandIndexfunctionsinExcel.ColumnBissortedby itemnumberinascendingorder.
What is simple exponential smoothing?
Elaborate on the use of geographic data mapping in business analytics.
Write a short note on indicators and indexes used in forecasting.
Compare between the t-distribution and the standard normal distribution.
State the three empirical rules in standard deviation.