C723 - Multiple Choice Questions

Which of the following is the term used for the outcome decision to be made that is governed by the constraints? Bounded region Objective function Center point

Objective function

1. Identify the problem 2. Establish decision criteria 3. Weight criteria 4. Generate alternatives 5. Evalute alternatives 6. Chose best alternative 7. Implement the decision 8. Evalutate the decision These are the 8 steps of what?

effective decision making

Acme Corp. makes couches and chairs using three main components: wood, foam, and fabric. It takes 60 linear feet to make a couch and 35 to make a chair. It takes 30 hours of labor to make a couch and 15 to make a chair. Couches sell for $800 and chairs for $350. State the mathematical representation to show that the company must make at least 20 chairs to fill backorders. Y = 20 Y >= 20Y Y <= 20

= is not appropriate < is making less than required Therefore the correct answer is: Y >= 20Y

Which of the following statements is true regarding slack time in a project? a. To determine slack time, subtract the early start from the late finish. b. Any task on the critical path cannot be delayed without delaying the entire project. c. Slack time refers to delays in an activity that will negatively impact the completion date for the project. d. If the slack time is equal to 0, then this task is not on the critical path.

Any task on the critical path cannot be delayed without delaying the entire project.

Network diagrams are visual tools used to do what? a. Plan complex projects b. Schedule complex project c. Control complex projects d. All of the above

All of the above

The company can install automated handling equipment or not, thereby adding to cost, but also adding to potential profitability. Which scenario is this an example of? Decision Point Expected Payoff State-of-Nature

Decision Point because this scenario gives a specific decision.

The company can build a small, medium, or large plant. Which scenario is this an example of? Decision Point Expected Payoff State-of-Nature

Decision point

A manufacturing firm is considering building either a large or small plant in another state. This is an example of what? Expected payoff Probability State-of-nature Decision point

Decision point - This is an example of a decision point, which is a point at which a determination is made to move down one specific path among several alternative paths.

The cells listed in the By Changing Cells in the Solver window are referring to which of the following? Constraints Decision variables Objective function

Decision variables

When faced with a complex problem to optimize a business function (i.e., cost minimization or sales maximization), the first step in linear programming is: a. Assemble the data. b. Establish a financial goal. c. Define the problem in terms of the objective.

Define the problem in terms of the objective.

An appliance distributor expects to sell about 9,600 refrigerators next year. The annual carrying cost is $16 per refrigerator, and the ordering cost is $75. The distributor operates 280 days a year. If the EOQ is 225, what is the length in workdays of an order cycle? 40 32 7

Divide the annual demand by the EOQ to determine the number of orders. Because there are 280 workdays in a year, divide the number of workdays by the number of orders. = 280/40 Answer is 7

In a linear programming graph, which of the following describes the area that satisfies all of the constraints? Possible solution Feasible region Objective function Cost minimization region

Feasible region

Acme Corp. makes couches and chairs using three main components: wood, foam, and fabric. It takes 60 linear feet to make a couch and 35 to make a chair. It takes 30 hours of labor to make a couch and 15 to make a chair. Couches sell for $800 and chairs for $350. The selling price would be part of which element? Objective Decision Variable Constraint

Objective

When describing a cause-and-effect relationship, variables are used. One variable is typically impacted by another. The variable that is not impacted by another variable is called what? Dependent variable Mediating variable Moderating variable Independent variable

Independent variable

Which of the following products might be good options for planned inventory shortages? Low demand items Name brand items High demand items

Inventory with low demand are good candidates for planned inventory shortages

There is a 85% chance of rain during the construction of the roof on a new house. This is an example of what? Decision point Probability State-of-nature Expected payoff

Probability - This is an example of a probability, which is a specific number that represents the likelihood of an occurrence of some state-of-nature.

1. Define problem. 2. Develop mathematical model. 3. Prepare and input data. 4. Find best solution. 5. Test solution. 6. Analyze results. 7. Implement solution. The list above is the steps to which process?

Quantitative Analysis

There is a 30% chance of a contracting economy (a recession) during the first 3 years after completion of the new plant. Which scenario is this an example of? Decision Point Expected Payoff State-of-Nature

State-of-Nature

How is the latest start time calculated? a. Add the task duration from the latest finish. b. Add the task duration from the earliest finish. c. Subtract the task duration from the latest finish.

Subtract the task duration from the latest finish.

In the EOQ model, several numeric inputs are used in the formula. What is the final mathematical step in using the EOQ formula? Addition Square of the total number Take the square root

Take the square root

Acme Corp. makes couches and chairs using three main components: wood, foam, and fabric. It takes 60 linear feet to make a couch and 35 to make a chair. It takes 30 hours of labor to make a couch and 15 to make a chair. Couches sell for $800 and chairs for $350. State the mathematical representation to show that the total number of linear feet of wood for both couches (X) and chairs (Y) cannot exceed 5,000. a. 60X + 35Y >= 5,00060X + 35Y >= 5,000 b. 35X + 60Y = 5,00035X + 60Y = 5,000 c. 60X + 35Y <= 5,00060X + 35Y <= 5,000

This adds 60 linear feet for each couch made to 35 linear feet for each chair made to arrive at total linear feet that cannot be exceeded c. 60X + 35Y <= 5,00060X + 35Y <= 5,000

A baker buys sugar in 25-pound bags. The bakery uses 1,215 bag a year, and ordering costs are $10 per order. It costs $75 to hold this in inventory for the year. How many orders will have to be made over the year. 18 / 1,215 1,215 / 75 1215 / 18

The formula is D/Q = 1,215 / 18 Where: D = Demand Q = economic order quantity 1215 / 18

An automotive equipment manufacturer uses 300 armatures a day in production. Delivery of the armatures takes 7 days. What is the reorder point for the armatures? 7 300 2100

The formula would be = 300 * 7. To determine the reorder point, multiply the daily demand by the number of days between ordering and receiving the items. 2100

An appliance distributor expects to sell about 9,600 refrigerators next year. The annual carrying cost is $16 per refrigerator, and the ordering cost is $75. The distributor operates 288 days a year. What is the economic order quantity for refrigerators? 128 34 300

The whole problem is a square root on Calulator hit sqrt with faction 2times Demand times order cost divided by carry cost sqrt 2*9600*75/16=300

Constructing a large factory in an expanding economy will likely realize a $2,500,000 profit in 3 years. Which scenario is this an example of? Decision Point Expected Payoff State-of-Nature

This scenario describes an expected payoff calculation.

Constructing a large plant with automated handling equipment in a contracting economy will result in a loss of $3,500,000 over 3 years. Which scenario is this an example of? Decision Point Expected Payoff State-of-Nature

This scenario describes an expected payoff calculation.

An automotive equipment manufacture uses about 3,200 armatures a year in production. They operate 240 days a year and will be ordering 10 times a year. What is the number of workdays in an order cycle? 24 320 8

To calculate the number of workdays in an order cycle divide the number of workdays by the number of orders placed. 240/10 = 24 24

What is the key purpose behind using the beta distribution technique to estimate task times? To ensure the costs are budgeted To provide a method that specified the costs To provide a faster way to make the estimate To provide a more accurate method

To provide a more accurate method

What is the formula for calculating an alternative's expected value? a. (alternative value * probability of occurrence) + (alternative value * probability of occurrence) b. (alternative value * probability of occurrence) - (alternative value * probability of occurrence)

a. (alternative value * probability of occurrence) + (alternative value * probability of occurrence)

What would be the best application of quantitative analysis for the situations below? a. A marketing director wants to determine the average household income of the company's key customers. b. A chef wants to determine the best method of food presentation for a new recipe for a very discerning customer. c. A professional photographer wants to determine the most romantic location to take pictures of a wedding entourage. d. A florist wants to determine the best arrangement for flowers for a very important client.

a. A marketing director wants to determine the average household income of the company's key customers.

Linear programming (LP) can be defined as: a. A mathematical technique that can be used identify the value of a variable, such as maximizing the profit of an operation, for a given set of constraints. b. A mathematical technique that can be used to identify the maximum value of a variable such as maximizing the shipping distances between locations of a business. c. A mathematical technique that can be used to identify the maximum value of a variable such as maximizing the consumption of parts used to manufacture a major appliance. d. A mathematical technique that can be used to identify the maximum value of a variable such as maximizing the cost of an operation.

a. A mathematical technique that can be used identify the value of a variable, such as maximizing the profit of an operation, for a given set of constraints.

Which of the following is an example of a linear programming application? a. Determining the best product mix for a retail store. b. Determining the highest level of customer satisfaction achieved from recent trouble logs. c. Determining the best use and benefits of installing a new phone system. d. Determining the lowest interest rate between different banks.

a. Determining the best product mix for a retail store.

In defining a cause and effect relationship, the variable that drives some change in another variable is called what? a. Independent variable b. Dependent variable c. Mediating variable d. Moderating variable

a. Independent variable

Like all approaches, subjective reasoning may have some inherent problems associated with it. What is one likely problem? a. Personal reflections are often fallible. b. It is very hard to compile subjective data. c. Subjective reasoning is a very hard skill to teach someone in the first place. d. It is very difficult to get people's opinions on many subjects.

a. Personal reflections are often fallible.

If there is a linear relationship between variables, we can say they are correlated. Determining that variables are correlated is very important; however, to draw specific conclusions about the cause and effect relationship will take additional advanced analytical techniques to further test the relationship in order to exclude other contributory factors that could have caused the change. When we have established a positive relationship between two variables, what can we conclude? a. There is an association between the variables but not proof that a change in one causes a change in the other. b. The answer cannot be determined from this question without knowing what the metrics are. c. That there will always be the same amount of change in the dependent variable based on the independent variable. d. This proves that one variable causes the change in another variable because it is positive.

a. There is an association between the variables but not proof that a change in one causes a change in the other.

Which of the following inventory costs would be a carrying cost? a. Utilities for the warehouse. b. Sending in a purchase order. c. Inspecting incoming inventory.

a. Utilities for the warehouse.

What is the correct order for the following steps? a. Weigh decision criteria, generate alternatives, and evaluate alternatives. b. Generate alternatives, evaluate alternatives, and weigh decision criteria. c. Evaluate alternatives, generate alternatives, and weigh decision criteria.

a. Weigh decision criteria, generate alternatives, and evaluate alternatives.

In studying cause and effect relationships, what can we say when there is a positive relationship between the variables? a. When the independent variable increases, the dependent variable will increase at a proportionate rate. b. The data represent a positive increase in assets from a company's point of view. c. There is never a decrease in the path of the independent variable; it only continues upward. d. There will always be an increase of one unit up in one variable in response to one unit up in the other variable.

a. When the independent variable increases, the dependent variable will increase at a proportionate rate.

Frank purchased 100 acres of farmland. He will use linear programming to determine how many acres of corn to plant and how many acres should be peas in order to maximize his profits. He makes $10 per bushel for peas and $7 per bushel for corn. The yield per acre for corn is 75 bushels and the yield for peas is 60 bushels per acre. He must leave 10% of his land uncultivated. What are the decision variables in this problem? a. number of acres planted of each crop (corn and peas) b. number of acres left uncultivated c. amount earned by each crop (corn and peas) d. number of bushels produced of each crop (corn and peas)

a. number of acres planted of each crop (corn and peas)

What is the best description of an open-ended question? a. A question with three or four specific answers b. A question that can be answered multiple ways c. A question that can be answered only one way d. A question that uses only subjective inputs

b. A question that can be answered multiple ways

Which of the following is a key assumption underlying a network diagram? a. An activity can begin only after all successors have been completed. b. An activity can begin only after all predecessors have been completed. c. A network diagram is cyclical.

b. An activity can begin only after all predecessors have been completed.

Which of the following is the main distinguishing factor of beta estimation for time duration and traditional time duration estimation? a. Beta estimation always uses statistical software to estimate. b. Beta estimation considers three time estimates for each task. c. The beta estimate considers economic risks. d. The beta estimate is done in conjunction with the finance department.

b. Beta estimation considers three time estimates for each task.

The process of linear programming involves understanding and incorporating limitations of the organization as it relates to the target problem. What is the main benefit of using linear programming? a. The data are easily assembled. b. Deals with complex problems, unified decisions, and risk assessment. c. Keeps the decision maker insulated from criticism.

b. Deals with complex problems, unified decisions, and risk assessment.

Which of the following is the most important and primary step in setting up a linear programming problem? a. Determine the feasible region. b. Define the problem. c. Establish the constraints.

b. Define the problem.

In defining a cause and effect relationship, the variable that is changed as a result of the action of some other variable is called what? a. Independent variable b. Dependent variable c. Mediating variable d. Moderating variable

b. Dependent variable

There are many forms of research and analysis considered in one of two general categories, quantitative and qualitative, both of which use mathematics to some degree. Quantitative analysis uses mathematics and statistics for which of the following? a. Determining the hot issues for voters in the next election. b. Determining the change in production from this year to the previous year. c. Gathering customer opinions about a product.

b. Determining the change in production from this year to the previous year.

The critical path denotes the longest time to complete any path that is part of the project. Why might the critical path be the longest? a. The critical path costs more to complete. b. Due to predecessors, the path that is the longest may have to start later than other tasks. c. The critical path contains the most important tasks.

b. Due to predecessors, the path that is the longest may have to start later than other tasks.

Which of the following are two primary questions to answer when managing inventory? a. How much money should be spent? How much inventory should be ordered? b. How much inventory should be ordered? When should the orders be placed? c. How much money should be spent? How frequently should the orders be placed?

b. How much inventory should be ordered? When should the orders be placed?

What is a key difficulty associated with using an open-ended questions? a. The answers are always too long because of their detail. b. The answers may not address the researcher's key question. c. The questions can only be asked in face-to-face interviews. d. The responses never provide the answer you want.

b. The answers may not address the researcher's key question.

One method of data collection is the use of closed-ended questions. What is the advantage of using this method for data collection? a. The answers to the questions are quantifiable and can be categorized. b. The feedback promotes a two-way conversation. c. The answers to the questions are valuable due to the variety of opinions available. d. The answers to the questions are shorter to write.

b. The feedback promotes a two-way conversation.

When would a business forecast tend to be the most accurate? a. At least a year in advance to know the background b. The time nearest the period under study c. After using many educated guesses d. When done by a Ph.D.

b. The time nearest the period under study

Under what circumstances could quantitative analysis be used successfully? a. When the situation is urgent and you need to complete the analysis quickly b. When the problem being analyzed can be numerically represented and valid and reliable data are available c. When there are many people involved in the problem in order to get lots of opinions d. When the problem being analyzed is clearly visible to the customers and clients

b. When the problem being analyzed can be numerically represented and valid and reliable data are available

When is quantitative analysis most useful? a. When an information system is involved in the process. b. When the problem being evaluated can be represented by discrete data that are valid, objective, and reliable. c. When the chief financial officer will be one of the decision-makers for the problem being evaluated. d. When the problem being evaluated has a large financial impact, usually more than $1 million.

b. When the problem being evaluated can be represented by discrete data that are valid, objective, and reliable.

There are times when subjective reasoning are particularly appropriate for use. What are some indicators of when to use subjective reasoning? a. When financial metrics are the key concern b. When topic involves personal reflections of events c. When census data are readily available d. When topic involves legal issues

b. When topic involves personal reflections of events

Which of the following scenarios would be LEAST likely to benefit from using linear programming? a. An airline is deciding how many tickets to sell at each price. b. A restaurant wants to decide how many of each entree to prepare using the products they have on hand. c. A factory is deciding which product the public would prefer. d. A production factory is deciding the most efficient way to get products from the factory to the warehouse.

c. A factory is deciding which product the public would prefer.

When arguing using subjective reasoning, on which of the following will the argument most likely be based? a. Using diagrams to understand b. Eyewitness accounts c. A person's past personal experiences d. Credentials in field of expertise

c. A person's past personal experiences

Which of the following description correctly explains how to calculate the expected activity completion time for an activity using the beta distribution method? a. Add the optimistic time, the pessimistic time, and 6 times the most likely time needed to complete an activity. Divide the result by 4. b. Add the optimistic time, the pessimistic time, and the most likely time needed to complete an activity. Divide the result by 3. c. Add the optimistic time, the pessimistic time, and 4 times the most likely time needed to complete an activity. Divide the result by 6.

c. Add the optimistic time, the pessimistic time, and 4 times the most likely time needed to complete an activity. Divide the result by 6. The correct formula is: test=A+(4*M)+P÷6

At what point during the decision-making process should quantitative analysis be used? a. During the conclusion and recommendation preparation b. After the decision is made to validate it c. At the beginning before the decision is made d. At the beginning of the data collection phase

c. At the beginning before the decision is made

Roger is starting his last year of college and is on a very tight budget. He wants to write out a budget for a major expense, his dinner menu. He knows he needs a certain amount of carbohydrates, vitamins, and proteins every day; this is the nutritional value. His favorite foods are steak and potatoes, and by weight the steak is three times as expensive as the potatoes. What type of LP problem is this? a. Capacity of the nutritional value of the carbohydrates, vitamins, and proteins. b. Profit maximizing subject to a minimal nutritional value of the carbohydrates, vitamins, and proteins. c. Cost minimizing subject to a minimal nutritional value of the carbohydrates, vitamins, and proteins. d. Cost avoiding subject to a minimal nutritional value of the of the carbohydrates, vitamins, and proteins.

c. Cost minimizing subject to a minimal nutritional value of the carbohydrates, vitamins, and proteins.

Which of the following represents an application of LP? a. Determining the best insurance policy to buy to cover a firm's inventory. b.Determining the safest car based on crash tests. c. Determining the most profitable inventory to keep in stock given different cost and profit levels. d. Determining the closest route for a truck to take to make a delivery.

c. Determining the most profitable inventory to keep in stock given different cost and profit levels.

Which of the following accurately describes quantitative analysis? a. Using various sampling techniques to analyze a phenomenon b. Using both objective and subjective information to get the most data c. Ensuring the use of valid, reliable, and objectively measurable data in order to understand a phenomenon d. Using only financial data to analyze a phenomenon

c. Ensuring the use of valid, reliable, and objectively measurable data in order to understand a phenomenon

What is a benefit of using EOQ? a. It is based on a probability coefficient. b. It considers all inventory factors in the calculations. c. It can minimize storage space used.

c. It can minimize storage space used. By ordering the right quantity, the chances of overstock are lessened.

A quantitative analysis can benefit by a researcher incorporating closed-ended questions to gain specific information. Research questions would be considered closed when the respondent can only select a specific answer. By using closed-ended questions, the researcher can ensure data validity and consistency. It is common for researchers to qualify their survey questions beforehand by validating that the responses will be closed ended. Using the qualified closed-ended questions will then help ensure that the actual responses from the universe of respondents will be credible and consistent. How is this possible? a. The responses can be limited to three by the researcher beforehand to limit confusion. b. The responses can be limited to the shortest possible length to prevent difficulty. c. The questions and responses can be qualified or validated by the researcher beforehand. d. The researcher can easily put the responses in the order of likely expected answers.

c. The questions and responses can be qualified or validated by the researcher beforehand.

There are several advantages to using closed-ended questions, saving time is one. How is this possible? a. The questions cannot be as easily categorized as open-ended questions can. b. The questions are usually much shorter in wording. c. The questions limit the range of possible answers available. d. The questions can be put in a better logical order than open-ended questions can.

c. The questions limit the range of possible answers available.

Under what circumstances might a researcher want to use closed-ended questions and not open-ended questions? a. When the researcher is looking to shorten what is written, making the researcher's job easier b. When the researcher lacks a fundamental understanding of the situation c. When the researcher knows the reasonable field of alternative answers d. When the researcher needs a two-way dialogue

c. When the researcher knows the reasonable field of alternative answers

What is one of the key and unique elements of linear programming where there are only two decision variables (x,y)? a. The answer is optimal some of the time. b. The answer can be a negative value. c. Only a computer program can solve a linear programming problem. d. All constraints associated with the problem are converted to linear form (straight lines).

d. All constraints associated with the problem are converted to linear form (straight lines).

Linear programming (LP) can solve a variety of problems in the areas of business and economics. An example of an application of LP: a. Determining the training needs of a sales force. b. Determining the best salesperson to use to close a critical sale. c. Determining customer satisfaction levels from a survey. d. Determining the most profitable mix of three products a company can make given different cost and profit levels.

d. Determining the most profitable mix of three products a company can make given different cost and profit levels.

There are many benefits to using linear programming (LP), which include: a. Linear programming can be used for all types of number sets, whether the numbers are linear or nonlinear. b. Linear programming functions are best for problems involving business profits only. c. Linear programming functions best for problems involving industrial costs only. d. Linear programming can be used to analyze a variety of economic, social, and business problems.

d. Linear programming can be used to analyze a variety of economic, social, and business problems.

Which of the following would be a factor that makes a problem complex or multifaceted? a. A problem involving technology b. A problem with a specific deadline c. One involving students at a college d. One involving a large business's IT servers competing time constraints

d. One involving a large business's IT servers competing time constraints

When a business is confronted with different types of numbers representing a business process, how can quantitative analysis be used? a. Quantitative analysis relies on financial data, which are the best for analysis. b. Quantitative analysis is used to audit financial data for accuracy and reliability. c. Quantitative analysis cannot be used because financial data are not part of quantitative analysis. d. Quantitative analysis can make sense of the various numbers using the best technique.

d. Quantitative analysis can make sense of the various numbers using the best technique.

In determining relationships between cause and effect, what does it mean if one variable increases as the other variable also increase? a. That the change will be identical throughout the data range b. Proof that one variable caused all of the change in another variable c. That there is a negative correlation between the variables d. That there is a positive correlation between the variables

d. That there is a positive correlation between the variables

What is a key advantage in using closed-ended questions? a. The answers allow a two-way dialogue. b. The answers are shorter to write. c. The answers are always shorter. d. They are easier to quantify and categorize.

d. They are easier to quantify and categorize.

Which of the following are some primary influencing factors involving subjective reasoning on a topic? a. The latest data from the FBI b. Computer technology c. Business forecasts d. Upbringing and past employment

d. Upbringing and past employment

What would be the best reason for not wanting to use quantitative analysis? a. When the human resources officer will be one of the decision-makers for the problem being evaluated b. When the problem being evaluated has little financial impact, usually less than $1 million c. When no information system is involved in the process d. When the problem being evaluated lacks the presence of objective, valid, reliable, and measurable data to use for the analysis

d. When the problem being evaluated lacks the presence of objective, valid, reliable, and measurable data to use for the analysis

There is a 70% chance of an expansion in the economy during an upswing. a. Which scenario is this an example of? b. Decision Point c. Expected Payoff d. State-of-Nature

d. state-of-nature

A __________ has the following characteristics: 1. The endeavor is outside of the routine or operational activities. 2. The assignment is a temporary endeavor. 3. The goal has a start and end date. 4. Every task in the project is specific to the objective or goal of the project.

project

An automotive equipment manufacture uses about 3,200 armatures a year in production. Annual carrying cost is $4 per armature, and the ordering cost is $100. They operate 240 days a year. What is the economic order quantity? 400 31 320

sqrt the whole probelm then 2*3200*100/4=400 400