1) Mean absolute deviation (MAD) is simply the sum of forecast errors.
2) A stockout is a situation that occurs when there is no inventory on hand.
3) The binomial distribution can be used when there are a small number of states of
nature and/or alternatives.
4) We may begin the maximal-flow technique by picking an arbitrary path through the
network.
5) The central limit theorem provides the statistical foundation for control charts.
6) An (M/D/1) queuing model is classified as probabilistic.
7) A posterior probability is a revised probability.
8) An M/M/2 model has Poisson arrivals exponential service times and two channels.
9) Statistical process control uses regression and other forecasting tools to help control
processes.
10) Unfortunately, goal programming, while able to handle multiple objectives, is
unable to prioritize these objectives.
11) In the linear programming transportation model, the coefficients of the objective
function can represent either the cost or the profit from shipping goods along a
particular route.
12) In a competitive business market, one company’s strategy might be to maximize its
minimum profits.
13) Bias is the average error of a forecast model.
14) There are no limitations on the number of constraints or variables that can be
graphed to solve an LP problem.
15) Table 11-3
According to Table 11-3, there are five activities in a PERT project. What is the
variance of the critical path?
A) 5.222
B) 4.222
C) 1.222
D) 0
E) 1.111
16) A plant manager is concerned with the variability of beer being filled in 12 oz. cans.
The most appropriate control chart would be which of the following?
A) x-bar chart
B) R-chart
C) p-chart
D) c-chart
E) None of the above
17) In the construction of decision trees, which of the following shapes represents a
state of nature node?
A) square
B) circle
C) diamond
D) triangle
E) None of the above
18) Given the following distances between destination nodes, what is the minimum
distance that connects all the nodes?
A) 900
B) 650
C) 400
D) 1200
E) None of the above
19) Which of the following is not acceptable as a constraint in a linear programming
problem (maximization)?
A) Constraint 1
B) Constraint 2
C) Constraint 3
D) Constraint 4
E) None of the above
20) The Department of Motor Vehicles (DMV) can service customers at a rate of 20 per
hour (or 1/3 per minute) when it comes to license renewals. The service time follows an
exponential distribution. What is the probability that it will take less than 2 minutes for
a particular customer to get a license renewal?
A) 1
B) 0.487
C) 0.513
D) 0
E) 0.1
21) Which of the following matrices is not a correct pairwise comparison matrix?
A) A
B) B
C) C
D) D
E) All are correct pairwise comparison matrices
22) Which of the following variables are probabilistic in an inventory model that
requires simulation?
A) demand only
B) lead time only
C) holding cost only
D) Both A and B
E) A, B, and C
23) A post office has a single line for customers waiting for the next available postal
clerk. There are two postal clerks who work at the same rate. The arrival rate of
customers follows a Poisson distribution, while the service time follows an exponential
distribution. What type of queuing model applies here?
A) M/M/1
B) M/M/2
C) M/D/2
D) M/D/1
E) M/G/1
24) The mean square error (MSE) is
A) denoted by s.
B) denoted by k.
C) the SSE divided by the number of observations.
D) the SSE divided by the degrees of freedom.
E) None of the above
25) Table M8-2
In Table M8-2, cell A3 should be selected to be filled in the next solution. If this was
selected as the cell to be filled, and the next solution was found using the appropriate
stepping-stone path, how many units would be assigned to this cell?
A) 10
B) 15
C) 20
D) 30
E) None of the above
26) David and Beth Sheba run a health food store. Their top selling item is called
Heavenly Kelp. The annual demand for this is 810 units, and demand is constant
throughout the year. The cost of placing an order is $20, while the holding cost per unit
per year is $4.
(a) How many orders per year should be placed if they wish to minimize their total
cost?
(b) What is the minimum possible annual holding and ordering cost?
27) A line in a network that may represent a path or a route is called a(n)
A) arc.
B) branch.
C) line.
D) fork.
E) sink.
28) The mathematical theory behind linear programming states that an optimal solution
to any problem will lie at a(n) ________ of the feasible region.
A) interior point or center
B) maximum point or minimum point
C) corner point or extreme point
D) interior point or extreme point
E) None of the above
29) If, in the optimal tableau of a linear programming problem, an artificial variable is
present in the solution mix, this implies
A) infeasibility.
B) unboundedness.
C) degeneracy.
D) alternate optimal solutions.
E) a finite optimal solution.
30) SAP, Oracle, and PeopleSoft are all examples of
A) MRP systems.
B) ERP systems.
C) JIT systems.
D) EDI systems.
E) None of the above
31) A(n) ________ is a representation of reality or a real-life situation.
A) objective
B) model
C) analysis
D) algorithm
E) None of the above
32) PERT stands for
A) probabilistic evaluation and review technique.
B) program evaluation and review technique.
C) probability of expected run times.
D) program of expected run times.
E) project evaluation and review technique.
33) Evaluate the determinant .
34) In regression, the variable to be predicted is called the ________ variable.
35) Describe the adjoint.
36) Expected opportunity loss has the same value as ________.
37) Define dual price.
38) An IT project requires 6 activities. The table below displays the expected time and
budgeted cost for each activity.
Develop a budget for the 15 weeks of the project using LS times.
39) Briefly describe why the scatter diagram is helpful.