Question 1
Scatter diagrams can be useful in spotting trends or cycles in data over time.
True
False
Question 2
The regression model assumes the residuals are normally distributed.
True
False
Question 3
In a simple regression model, a variable that can be controlled is called dependent variable.
True
False
Question 4
If the value of SSR is 10 and the value of SST is 59; the value of SSE is 64.
True
False
Question 5
A sensitivity analysis allows a manager to answer the “what if” questions.
True
False
Question 6
EVPI places an upper bound on what you should pay for additional information.
True
False
Question 7
A parameter is a measurable quantity that may vary or is subject to change.
True
False
Question 8
In decision making under risk if the expected value of perfect information (EVP1) is 2500SR and the company (information seeker) is asked to pay 3000SR for extra information. Should the company pay for the extra information?
Yes=True, No=False
True
False
Question 9
The point at which the total revenue equals total cost is called the Optimal-profit solution
True
False
Question 10
The decision theory processes of maximizing expected monetary value (EMV) and minimizing expected opportunity loss (EOL) should lead us to choose the same alternatives.
True
False
Question 11
The following is a payoff table:
| States of Nature | |||
| Alternatives | A | B | C |
| Alternative 1 | 30 | 0 | 10 |
| Alternative 2 | 5 | 20 | 0 |
| Alternative 3 | 0 | 20 | 25 |
What decision should be made based on the minimax regret criterion?
| State of nature C | ||
| Alternative 2 | ||
| Alternative 1 | ||
| Alternative 3 |
Question 12
Which of the following is a technique used to determine forecasting accuracy?
| a. | exponential smoothing | |
| b. | mean absolute percent error | |
| c. | Delphi method | |
| d. | moving average |
Question 13
Given the following gasoline data:
| Quarter | Year 1 | Year 2 | Average Quarterly demand | Average seasonal index |
| 1 | X | 156 | 164.25 | .932 |
| 2 | 140 | 148 | 164.25 | .877 |
| 3 | 185 | 201 | 164.25 | 1.175 |
| 4 | 160 | 174 | 164.25 | 1.017 |
what is the value of missing value X?
| a. | 160 | |
| b. | 150 | |
| c. | 140 | |
| d. | 161 |
Question 14
A utility curve showing utility increasing at an increasing rate as the monetary value increases represents
| Utility assessment | ||
| conditional values | ||
| A risk avoider | ||
| A risk seeker |
Question 15
A set of logical and mathematical operations performed in a specific sequence is called a(n)
| a. | Complete enumeration. | |
| b. | Diagnostic analysis. | |
| c. | Algorithm. | |
| d. | Objective. |
Question 16
Which of the following is not a measure of historical forecasting errors?
| a. | MSE | |
| b. | Mean | |
| c. | MAD | |
| d. | Bias |
Question 18
Which of the following is not True for moving averages?
| a. | The next forecast is the sum of the most recent n data values from the time series. | |
| b. | The method tends to smooth out short-term irregularities in the data series. | |
| c. | None of the above | |
| d. | Moving averages can be used when demand is relatively steady over time. |
Question 19
The following is a payoff table giving profits for various situations
| States of Nature | |||
| Alternatives | A | B | C |
| Alternative 1 | 140 | 100 | 120 |
| Alternative 2 | 120 | 110 | 120 |
| Alternative 3 | 150 | 90 | 110 |
| Do nothing | 0 | 0 | 0 |
What is the best decision according to the Laplace criterion?
| Alternative 2 | ||
| Alternative 1 | ||
| Do nothing | ||
| Alternative 3 |
Question 20
The following is a decision table:
| States of Nature | |||
| Alternatives | A | B | C |
| Alternative 1 | 50 | 20 | 10 |
| Alternative 2 | 60 | 0 | 20 |
| Alternative 3 | 20 | 10 | 40 |
What decision should be made based on Hurwicz method with α = 0.6 ?
| Alternative 1 | ||
| Alternative 3 | ||
| State of nature A | ||
| Alternative 2 |
Question 21
Regression calculations reveal the following:
Σ(Y – )2 = 42, Σ(Y –)2 = 10. Therefore, SSR would be
| 32 | ||
| 4 | ||
| 40 | ||
| 0.25 |
Question 22
In a Production Company, the materials and labor cost for making a product is $200 and the fixed cost per week is $2000. The selling price for each product is $300. How many products must be sold by the company per week to breakeven point?
| a. | 20 | |
| b. | 50 | |
| c. | 150 | |
| d. | None of the above |
Question 23
Sales for boxes of Girl Scout cookies over a 4-month period were forecasted as follows: 100, 120, 115, and 123. The actual results over the 4-month period were as follows: 110, 114, 119 and 115. What was the MSE of the 4-month forecast?
| a. | 7 | |
| b. | 0 | |
| c. | none of the above | |
| d. | 5 |
Question 24
Which among the following is true for dummy variable in regression analysis?
| Binary (or dummy or indicator) variables are special variables created for qualitative data | ||
| A dummy variable is assigned a value of 1 if a particular condition is met and a value of 0 otherwise. | ||
| The number of dummy variables must equal one less than the number of categories of the qualitative variable. | ||
| All the given answers. |
Question 25
The diagram below illustrates data with a :
| Negative correlation coefficient. | ||
| Zero correlation coefficient | ||
| Positive correlation coefficient. | ||
| Correlation coefficient equal to +1 |
Question 26
Maximin decision rule is used to find the alternative that minimizes the maximum payoff.
True
False
Question 27
Models that do not involve risk or chance are called probabilistic models.
True
False
Question 28
If the forecasted value of a certain product in a company is 15 and its actual value is 18, then forecast error will be -18.
True
False
Question 29
Qualitative models attempt to incorporate judgmental or subjective factors into the forecasting model.
True
False
Question 30
In the regression model, if every sample point is on the regression line (when all errors are 0), then the correlation coefficient would be -1 or 1.
True
False
Question 31
Assume that you have tried three different forecasting models. For the first, the MAD = 1.5, for the second, the MAD = 5.5, and for the third, the MAD = 3.7. We can then say that methods one is preferable to method second and third.
True
False
Question 32
Regression calculations reveal the following:
Therefore, SSR would be 40.
True
False
Question 33
Demand for a particular type of battery fluctuates from one week to the next. A study of the last six weeks provides the following demands (in dozens): 4, 5, 3, 2, 8, 10. Forecast demand for the next week using a two-week moving average is 9.
True
False
Question 34
If a company has total annual profit of SR 10000 and the monthly expenses are SR 13000 then the total (annual) revenue of the company is equal to SR23000.
True
False
Question 35
A parameter is a measurable quantity that may vary or is subject to change.
True
False
Question 36
In a Production Company, the materials and labor cost for making a product is $200 and the fixed cost per week is $2000. The selling price for each product is $300. How many products must be sold by the company per week to breakeven point?
| a. | 20 | |
| b. | 50 | |
| c. | 150 | |
| d. | None of the above |
Question 37
Enrollment in a particular class for the last four semesters has been 122, 128, 100, and 155 (listed from oldest to most recent). The best forecast of enrollment next semester, based on a three-semester moving average would be.
| a. | 127.7 | |
| b. | 168.3 | |
| c. | 116.7 | |
| d. | 126.3 |
Question 38
- What is the range of the Hurwicz criterion coefficient of realism α?
| Greater than zero | ||
| 0 to +1 | ||
| -1 to 0 | ||
| -1 to +1 |
Question 39
Given the following data, if MAD = 1.25, what should be the value of X?
| Time Period | Actual (A) | Forecast (F) | |A-E| |
| 1 | 2 | 3 | 1 |
| 2 | X | 4 | – |
| 3 | 6 | 5 | 1 |
| 4 | 4 | 6 | 2 |
| a. | 3 or 5 | |
| b. | only 5 | |
| c. | 2 or 4 | |
| d. | only 3 |
Question 40
Which of the following is true about the expected value of perfect information?
| It is the amount you would pay for any sample study. | ||
| It is calculated as EMV minus EOL. | ||
| It is calculated as expected value with perfect information minus maximum EMV | ||
| It is the amount charged for marketing research. |
Question 41
Number of customers arriving at a 5 star restaurant on different days of the week is given in the following table:
| Day | Number of Customers arriving |
| Sunday | 10 |
| Monday | 14 |
| Tuesday | 17 |
| Wednesday | 20 |
Assuming that an initial forecast for Wednesday was 25. If the forecast for Thursday using exponential smoothing is 23, what is the value of smoothing constant Alpha?
| a. | 0.4 | |
| b. | 0.6 | |
| c. | 0.3 | |
| d. | 0.5 |
Question 42
In quantitative analysis, a(n) ________ is a representation of reality or a real-life situation.
| a. | Objective | |
| b. | Model | |
| c. | Analysis | |
| d. | Algorithm |
Question 43
Total revenue equals:
| a. | Price plus the quantity. | |
| b. | Price multiplied by the quantity sold. | |
| c. | Price divided by the quantity sold. | |
| d. | Price minus the quantity sold. |
Question 44
Given the following data of Blackboard Collaborate complains of instructors of SEU from the last two years:
| Quarter | Year 1 | Year 2 |
| 1 | 90 | 90 |
| 2 | 85 | 95 |
| 3 | 105 | 115 |
| 4 | 100 | 120 |
What is the average seasonal index for quarter 2?
| a. | 0.9 | |
| b. | 1.0 | |
| c. | 1.2 | |
| d. | 0.8 |
Question 45
A measurable quantity that is subject to change, and cannot be controlled is known as a(n)
| a. | Dependent variable. | |
| b. | Algorithm. | |
| c. | Model Parameter. | |
| d. | Independent Variable. |
Question 46
The profit equation for a company is given as follows:
If the total expenses of this company is 4000, then how may units are sold?
| a. | 40 | |
| b. | 20 | |
| c. | 50 | |
| d. | 10 |
Question 22
The following payoff table provides profits based on various possible decision alternatives and various levels of demand with probabilities of different demands
| States of Nature | |||
| Demand | |||
| Alternatives | Low | Medium | High |
| Alternative 1 | 15 | 10 | 20 |
| Alternative 2 | 50 | 80 | 90 |
| Alternative 3 | 30 | 70 | 12 |
| Probability | 0.5 | 0.2 | 0.3 |
What will be the Expected Value with perfect information (EVwPI)?
| 68 | ||
| 56 | ||
| 110 | ||
| 52 |
Question 23
In a regression analysis if r2 = 1, then the SSE must also be equal to:
| 1 | ||
| 0 | ||
| Any positive value | ||
| 0.5 |
Question 24
Daily demand for newspapers for the last 10 days has been as follows: 12, 13, 16, 15, 12, 18, 14, 12, 13, 15 (listed from oldest to most recent). Forecast sales for the next day using a three-day weighted moving average where the weights are 3, 1, and 1 (the highest weight is for the most recent number).
| a. | 14 | |
| b. | 70 | |
| c. | 12.8 | |
| d. | 13 |
Question 25
Assume that you have tried three different forecasting models. For the first, the MAD = 2.5, for the second, the MSE = 2.1, and for the third, the MAPE = 2.7. We can then say:
| a. | Nothing can be said. | |
| b. | Methods one and three are preferable to method two. | |
| c. | The third method is the best. | |
| d. | The second method is the best. |
