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 weighted distance between Shirley’s new
accommodation and Bungalow 3?
A) 3152.08
B) 1529.39
C) 346.77
D) 250.78
In the linear trend equation Ft+k = at + btk, identify the term that signifies the trend.
A) bt
B) k
C) at
D) Ft + k
Which of the following values of the coefficients of variation of stocks represents the
least risky stock?
A) 1.0
B) 0.005
C) 0.5
D) 0.045
Which of the following is implied from the standard error of the mean formula?
A) that true means of populations can be found easier than those of samples
B) that standard deviation increases with increase in sample size
C) that larger sample sizes provide greater accuracy in estimating the true population
mean
D) that the true mean of the population can only be calculated using smaller sample
sizes
Jonathan Reese is considering three stocks in which to invest with a fixed budget. The
table below provides information on Jonathan’s expected returns for each stock. The
table also provides information, collected from market researchers, on the
variance-covariance matrix of the individual stocks. He expects a total return of at least
10%.
Develop a quadratic optimization model to find the optimal allocation of the budget to
each stock, and variance calculations for squared terms and cross-products based on the
variance-covariance matrix.
According to the model, what is the expected variance of the resulting portfolio?
A) 0.014
B) 0.010
C) 0.009
D) 0.012
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.
Which of the following gives the constraint for the demand met at a distribution center?
A) X11 + X21 = 1,250
B) X13 + X23 ≥ 210
C) X13 + X23 = 770
D) X13 + X23 = 480
For a simple linear regression model, significance of regression is:
A) a measure of how well the regression line fits the data.
B) a hypothesis test of whether the true regression coefficient 1 is zero.
C) a statistic that modifies the value of R2 by incorporating the sample size and the
number of explanatory variables in the model.
D) the variability of the observed Y-values from the predicted values.
Which of the following is a difference between the t-distribution and the standard
normal distribution?
A) The t-distribution cannot be calculated without a known standard deviation, while
the standard normal distributions can be.
B) The standard normal distribution’s confidence levels are wider than those of the
t-distribution.
C) The t-distribution has a larger variance than the standard normal distribution.
D) The standard normal distribution is dependent on parameters like degrees of
freedom, while t-distribution is not.
U-botit.com is an electronic commerce company that sells music online. It keeps a tab
of what genre of music their registered customers buy. If u-botit.com were to use the
data mining approach of association, which of the following actions would it take?
A) send recommendations to customers based on their buying habits
B) conduct surveys to customers to gauge customer satisfaction
C) classify the customers based on the genre of music they listen to
D) provide discounts to certain genre buyers where sales are less
The strength of the association rule, known as lift, is calculated as the ratio of the
________.
A) sum of the antecedents and the consequents to the antecedents
B) antecedents to the consequents
C) support to the confidence level
D) confidence to expected confidence
Which of the following is true about the rejection region?
A) The rejection region is chosen to determine the probability of a Type I error.
B) With a true null hypothesis, the test statistic falls into the rejection region.
C) If the test statistic is in the nonrejection region, the null hypothesis is rejected.
D) The rejection region occurs in the tails of the sampling distribution of the test
statistic.
Below is the spreadsheet for a project selection model:
What is the total amount of personnel used for all five projects?
A) 23
B) 17
C) 10
D) 4
Which of the following describes a positively skewed histogram?
A) a histogram that tails off toward the right
B) a histogram that has no fluctuation in mass
C) a histogram where more mass tails off toward the left
D) a histogram where mass is only concentrated in the middle
Which of the following mathematical functions, used in predictive analytical models, is
represented by the formula y = ax3 + bx2 + cx + d?
A) exponential functions
B) power functions
C) logarithmic functions
D) polynomial functions
Which of the following is true of linear functions used in predictive analytical models?
A) It is used when the rate of change in a variable decreases or increases quickly and
then levels out.
B) It is used when there is a steady decrease or increase over a range of a variable.
C) It is used when there is increase at a specific rate.
D) It is used when there is a rise or fall at a constantly increasing rate.
Which of the following is true about one-tailed and two-tailed tests?
A) For standard normal and t-distributions, which have a mean of zero, lower-tail
critical values are negative and upper-tail critical values are positive.
B) For an upper one-tailed test, if the test statistic is greater than the critical value, the
decision would be to fail to reject the null hypothesis.
C) For a lower one-tailed test, if the test statistic is less than the critical value, the
decision would be to fail to reject the null hypothesis.
D) For a two-tailed test, if the test statistic is either greater than the upper critical value
or less than the lower critical value, the decision would be to fail to reject the null
hypothesis.
Below is the spreadsheet for a project selection model:
What is the total amount of cash used for all five projects?
A) $ 175,000
B) $ 163,000
C) $ 215,000
D) $ 260,000
How does the Risk Solver Platform define an uncertain function cell?
A) It is a cell that contains a triangular distribution function.
B) It is a cell in which a distribution of output values is created from the model.
C) It is a cell in which an uncertain variable is used to define a distribution.
D) It is a cell that can only be defined by discrete distributions.
The table provided below gives the sales details of the number of android smart phones
at an electronic retail store for the past 6 weeks. The time series appears to be relatively
stable, without trend, seasonal, or cyclical effects. (Hint: Optimize α value in 0.1
increments)
Which of the following is the value of the root mean square error for the given data?
A) 11.56
B) 21.77
C) 13.87
D) 20.13
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 mode obtained from the simulation results?
A) $28,435
B) $22,485
C) $27,198
D) $25,394
Sheila joined Simsin Tradings at the age of 36 with a starting salary of $ 75,000. She
expects a salary increase of 5 percent every year. Her retirement plan requires her to
pay 9 percent of her salary, while the company matches it at 32 percent. She expects an
annual return of 7 percent on her retirement portfolio. Using a predictive model for
Sheila’s first five years, calculate the following, assuming that the salary increases at the
same rate every year, and the return of interest does not change.
What will be Sheila’s salary in her second year of work at Simsin?
A) $81,750
B) $82,688
C) $78,750
D) $ 75,000
Below is a payoff table with three mortgage options:
What is the expected opportunity loss for the 1-year ARM?
A) $ 7,979.60
B) $ 3,959.40
C) $ 6,853.50
D) $ 8,621.40
Which of the following is true of the R-squared (R value in Excel’s Trendline function?
A) A value of 1.0 for R2 indicates maximum deviation of the data from the line.
B) If the value of R2 is above 1.0, the line will be at a perfect fit for the data.
C) The value of R2 will always be between -1 and 1.
D) As the value of R2 gets higher, the line will be a better fit for the data.
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 total cost incurred by Letherin
Hides for the combined seasons?
A) $17,885
B) $15,605
C) $15,700
D) $18,700
In _____ functions, represented by y = abx, y rises or falls at constantly increasing rates.
A) logarithmic
B) power
C) exponential
D) polynomial
Construct a relative frequency distribution for items in the purchase order database and
show the proportions of the frequencies visually using a pie chart.
Explain the implementation of a project-selection model.
Following is an extract from a firm’s database detailing the number of hours spent on
the job by employees and their corresponding pay. (Note: Assume a level of
significance of 0.05 wherever necessary.)
Draw conclusions for test of hypothesis for regression coefficients.
Following is an extract from a firm’s database detailing the number of hours spent on
the job by employees and their corresponding pay. (Note: Assume a level of
significance of 0.05 wherever necessary.)
Interpret residual output.
Explain how data are used by accountants, economists, and operations managers.
What is Monte Carlo simulation?
Explain how the Data Validation feature in Excel helps in increasing spreadsheet
quality.
Explain the travelling salesperson problem with examples.
Gruten Retailers sells Mother’s Day special greeting cards at their store at $6. They
make the cards for a dollar apiece. Most of the cards are sold by Mother’s Day, but the
actual demand is unknown. They have orders for 120 cards. In the past, they have had
sales of at least 100 cards by Mother’s Day. The remaining cards are sold at a 40 percent
discount. Calculate the net profit, if demand, D, is set at 110 units.