ACCT 3300 Ch 16(2)

Multiple regression analysis involves the use of Dependent Variables Independent Variables A. One More than one B. More than one More than one C. More than one One D. One One

A. One More than one

The results of regressing y against x are as follows: Coefficient Intercept 5.23 Slope 1.54 When the value of x is 10, the estimated value of y is A. 20.63 B. 6.78 C. 8.05 D. 53.84

A. 20.63

A simple regression equation has an r 2 of 0.85. This means that A. 85% of the variation of the dependent variable is explained by the regression line. B. The dependent variable does not have a strong correlation with the independent variable. C. 85% of the variation of the independent variable is explained by the regression line. D. The dependent and independent variables have a correlation coefficient of 0.85.

A. 85% of the variation of the dependent variable is explained by the regression line.

Which of the following is a correct statement regarding volume-based value? A. The more data businesses have on the customers, both recent and historical, the greater the insights. B. Rapid analysis capabilities provide businesses with the right decision in time to achieve their customer relationship management objectives. C. In the digital era, capability to acquire and analyze varied data is extremely valuable. D. The faster businesses can inject data into their data and analytics platform, the more time they will have to ask the right questions and seek answers.

A. The more data businesses have on the customers, both recent and historical, the greater the insights.

Which of the following best describes a characteristic of big data? A. Data collected are free from useless information or incorrect variables. B. Data of untapped markets is often not collected. C. Big data is in a visual context, such as a graph or chart, rather than a text format. D. Collected data often provides straightforward answers to users.

B. Data of untapped markets is often not collected.

Which of the following most likely shows a cyclical pattern? A. Economic data affected by recession. B. An increase in oil prices due to an oil workers' strike. C. An increase in sales of gloves in the winter. D. Traffic peaks in the morning and evening hours.

A. Economic data affected by recession.

What is a miner? A. A computer user who validates and processes blockchain transactions. B. A type of blockchain. C. A person who is authorized to delete blocks from a blockchain. D. An algorithm that predicts the next step in a blockchain.

A. A computer user who validates and processes blockchain transactions.

A car insurance company is considering opening branches in a foreign country. The country's population has been growing rapidly for the last 5 years. The company wants to know whether the number of car accidents are correlated with the recent population growth. Which of the following charts prepared by an analyst would be most helpful to the company? A. A scatter plot showing the number of car accidents on the y-axis and the population size on the x-axis. B. A line chart showing each month on the x-axis and the number of car accidents on the y-axis. C. A pie chart showing the number of car accidents in each city for the last 5 years. D. A table showing the number of car accidents in rows and the population size in columns.

A. A scatter plot showing the number of car accidents on the y-axis and the population size on the x-axis.

A hospital has observed an increase in the number of cases of a disease and has asked an analyst to collect data on the cases over the last 3 years. The analyst noted that the disease appeared 3 years ago during the second quarter of the year. Since then, the third and fourth quarters of each year showed significant spikes in the number of cases when compared to the first two quarters. What is the best way to present these findings? A. Bar graph, showing the number of cases in each quarter for the last 3 years. B. Table, showing the number of cases in each month for the last 3 years. C. Pie chart, showing the number of cases in each quarter for the last 3 years. D. Scatter plot, showing the change in the number of cases for each quarter for the last 3 years.

A. Bar graph, showing the number of cases in each quarter for the last 3 years.

All of the following are correct statements regarding big data except A. Big data includes information collected from social media, data from Internet-enabled devices, machine data, video, and voice recordings. The information collected is converted from high-density data into low-density data. B. Big data is an evolving term that describes any voluminous amount of structured, semi-structured, and unstructured data that has the potential to be mined for information. C. Big data is often characterized by the "4 Vs": volume, variety, velocity, and veracity. D. Big data involves processing data with analytic and algorithmic tools to reveal meaningful information.

A. Big data includes information collected from social media, data from Internet-enabled devices, machine data, video, and voice recordings. The information collected is converted from high-density data into low-density data.

Multiple regression differs from simple regression in that it A. Has more independent variables. B. Provides an estimated constant term. C. Has more dependent variables. D. Allows the computation of the coefficient of determination.

A. Has more independent variables.

An analyst completed a sensitivity analysis for sales and prepared the following graph: Based on the graph, which of the following is the most appropriate conclusion? A. If the company has $6,500 to spend on one of the listed cost categories it should spend it on R&D to maximize sales. B. If the company has $2,000 to spend on one of the listed cost categories it should spend it on packaging to maximize sales. C. R&D expenses has the highest impact on sales compared to packaging expenses and advertising expenses. D. If the company has less than $2,000 to spend, advertising expenses has the lowest impact on sales compared to packaging expenses and R&D expenses.

A. If the company has $6,500 to spend on one of the listed cost categories it should spend it on R&D to maximize sales.

An analyst is performing a sensitivity analysis on how changes in the inflation rate and the interest rate can affect bond prices. Which of the following most likely causes the sensitivity analysis to be inaccurate? A. Interest rates are affected by changes in the inflation rate. B. Bond prices are extremely volatile to both changes in inflation and interest rates. C. Inflation is expected to increase in the next year. D. The interest rate changes affect bond prices to a greater extent than the inflation rate.

A. Interest rates are affected by changes in the inflation rate.

Which of the following is a correct statement regarding Hadoop? A. It is open source software framework that stores large amounts of data and runs applications on clusters of commodity hardware. B. It analyzes text data from the web, comment fields, books, and other text-based sources through the use of machine learning or natural language processing technology. C. It is a technology that uses data, statistical algorithms, and machine-learning techniques to identify the likelihood of future outcomes based on historical data. D. It analyzes data from system memory instead of hard drives.

A. It is open source software framework that stores large amounts of data and runs applications on clusters of commodity hardware.

Which of the following is a critical success factor in data mining a large data store? A. Pattern recognition. B. Accurate universal resource locator (URL). C. Effective search engines. D. Image processing systems.

A. Pattern recognition.

Which one of the following statements defines data mining? A. A process of using algorithms that serve to facilitate efficient communication within a firm. B. A process of using statistical techniques to extract and analyze data from large databases to discern patterns and trends. C. A system used to develop a firm's performance metrics. D. A system used to organize and interpret complex data to ensure the data has been accurately recorded in the database.

B. A process of using statistical techniques to extract and analyze data from large databases to discern patterns and trends.

A cost-volume-profit model developed in a dynamic environment determined that the estimated parameters used may vary between limits. Subsequent testing of the model with respect to all possible values of the estimated parameters is termed A. A time-series study. B. A sensitivity analysis. C. Learning curve analysis. D. Expected value analysis.

B. A sensitivity analysis.

A company developed the following multiple regression equation, utilizing 10 years of data, and uses it to estimate the cost of its product. Total cost = F + aL + bM Where: F = fixed costs L = labor rate per hour M = material cost per pound Which of the following changes would most likely have the greatest impact on invalidating the results of this model? A. Renegotiation of the union contract resulting in a higher wage rate. B. A significant change in labor productivity. C. A significant reduction in factory overhead. D. Changing the source of material to a low-cost foreign source.

B. A significant change in labor productivity.

Which of the following is included in the Four Vs of big data? A. Velocity. B. All of the answers are correct. C. Volume. D. Variety.

B. All of the answers are correct.

Which of the following is a best practice for visualization tools to avoid distortion in the communication of complex information? A. Exclude calculations from the design to ensure the user can interpret data in their own way. B. Ask others for feedback before finalizing the design to ensure understandability. C. Use variant shades of the same color to present subgroups classified under one group. D. Present various items in different scales and skip values to highlight items emphasized by the presenter.

B. Ask others for feedback before finalizing the design to ensure understandability.

Data visualization A. Ensures the presentation of trends and correlations are understood by a wider audience without bias. B. Assists with big data analytics to display data results in a visual context. C. Includes visualization tools such as bubble charts, pareto diagrams, boxplots, and what-if analyses. D. Is most useful to an audience when visualization tools present various items in different scales and skip values to highlight items emphasized by the presenter.

B. Assists with big data analytics to display data results in a visual context.

A company uses big data analytics in marketing. Which of the following is a limitation of using big data? A. Data results cannot be visualized to identify and forecast customer trends. B. Big data cannot explain why customers behave in certain ways. C. The company can use big data to predict customer behaviors. D. Data collected only represent untapped customers but not tapped customers.

B. Big data cannot explain why customers behave in certain ways.

The goal of structured query language (SQL) is to A. Evaluate and document the structure of the database. B. Create, update, retrieve, and manage data within a database. C. Clean up incorrect, incomplete, or duplicated data before uploading it into the database. D. Provide detailed information about the size, format, usage, meaning, and ownership of every data element.

B. Create, update, retrieve, and manage data within a database.

Statistical quality control often involves the use of control charts whose basic purpose is to A. Monitor internal control applications of information technology. B. Detect performance trends away from normal operations. C. Determine when accounting control procedures are not working. D. Control labor costs in production operations.

B. Detect performance trends away from normal operations.

What-if analysis is also known as A. Trend analysis. B. Goal seeking analysis. C. Regression analysis. D. Horizontal analysis.

B. Goal seeking analysis.

Which is the correct order of the steps in the data mining process? Perform regression analysis to generate an equation that models the data. Identify anomalies and unusual data records. Prepare visual presentations and reports. Generalize the relationships among data. Find relationships between variables and group the relationships. A. II, IV, V, III, I. B. II, V, IV, I, III. C. II, I, IV, V, III. D. I, V, IV, II, III.

B. II, V, IV, I, III.

Which of the following is a correct statement regarding in-memory analytics? A. It is an open source software framework that stores large amounts of data and runs applications on clusters of commodity hardware. B. It analyzes data from system memory instead of hard drives. C. It is a technology that uses data, statistical algorithms, and machine-learning techniques to identify the likelihood of future outcomes based on historical data. D. It examines large amounts of data to discover patterns in the data.

B. It analyzes data from system memory instead of hard drives.

A cereal producer often receives complaints that boxes are underweight. To gather data on the extent of this problem, the producer should develop which of the following? A. Cost-of-quality analysis. B. Statistical control chart. C. Fishbone diagram. D. Pareto chart.

B. Statistical control chart.

A manufacturer mass produces nuts and bolts on its assembly line. The line supervisors sample every nth unit for conformance with specifications. Once a nonconforming part is detected, the machinery is shut down and adjusted. The most appropriate tool for this process is a A. Cost of quality report. B. Statistical quality control chart. C. Regression analysis. D. Fishbone diagram.

B. Statistical quality control chart.

Which of the following most likely shows an irregular pattern? A. Increase in the number of tourists during weekends and holidays. B. Increase in GDP during expansion. C. Decrease in the number of tourists due to an earthquake. D. Decrease in the sales of ice cream during winter.

C. Decrease in the number of tourists due to an earthquake.

The new purchasing director is analyzing purchase orders for the organization. Which of the following analyses would best be displayed on a histogram? A. Identify and organize the reasons the average turnaround time for purchase orders falls outside the control parameters of 4-10 days. B. The organization purchased US $27 million worth of inventory in the past year. Distribute by value, using US $500 increments, the quantity of purchase orders that fall within each range. C. The average turnaround time from issuing a purchase order to receiving the merchandise is 7 days. Review the last 2,000 purchase orders, and using 10 days as the upper control limit and 4 days as the lower control limit, graph the turnaround time for each order. D. In the past year the organization placed 10,000 purchase orders. Organize the number of orders placed with each supplier, sorted in descending order.

B. The organization purchased US $27 million worth of inventory in the past year. Distribute by value, using US $500 increments, the quantity of purchase orders that fall within each range.

In order to analyze sales as a function of advertising expenses, the sales manager of Smith Company developed a simple regression model. The model included the following equation, which was based on 32 monthly observations of sales and advertising expenses with a related coefficient of determination of .90. Sales = $10,000 + (2.5 × Advertising expenses) If Smith Company's advertising expenses in 1 month amounted to $1,000, the related point estimate of sales would be A. $11,250 B. $2,500 C. $12,500 D. $12,250

C. $12,500

Mat Co. estimated its materials handling costs at two activity levels as follows: Kilos Handled Cost 80,000 $160,000 60,000 132,000 What is Mat's estimated cost for handling 75,000 kilos? A. $157,500 B. $150,000 C. $153,000 D. $165,000

C. $153,000

In preparing the annual profit plan for the coming year, Fine Company wants to determine the cost behavior pattern of the maintenance costs. Fine has decided to use linear regression by employing the equation y = a + bx for maintenance costs. The results of the regression analysis are given below. a 684.65 b 7.2884 Based upon the data derived from the regression analysis, 420 maintenance hours in a month would mean that Fine Co.'s maintenance costs (rounded to the nearest dollar) would be budgeted at A. $3,790 B. $3,600 C. $3,746 D. $3,780

C. $3,746

Cook Co.'s total costs of operating five sales offices last year were $500,000, of which $70,000 represented fixed costs. Cook has determined that total costs are significantly influenced by the number of sales offices operated. Last year's costs and number of sales offices can be used as the bases for predicting annual costs. What would be the budgeted cost for the coming year if Cook were to operate seven sales offices? A. $602,000 B. $700,000 C. $672,000 D. $586,000

C. $672,000

A health insurer uses a computer application to monitor physician bill amounts for various surgical procedures. This program allows the organization to better control reimbursement rates. The X-bar chart below is an example of the output from this application. Select the interpretation that best explains the data plotted on the chart. A. Cyclic variation. B. Normal variation. C. Abnormal variation. D. Positive correlation.

C. Abnormal variation.

Exploratory data analysis A. Rarely uses graphical tools in order to avoid bias generated from manipulating visualization tools. B. Often develops assumptions at an early stage so that anomalies can be identified sooner than traditional techniques. C. Aims to reveal patterns and discover insights by uncovering the underlying structure of data. D. Is often used as the last step of the data analysis process to gain new insight into the data.

C. Aims to reveal patterns and discover insights by uncovering the underlying structure of data.

Time series analysis A. Uses trial and error to determine the effects of changes in assumptions on outcome. B. Assists with determining whether a sample is representative of the population. C. Analyzes current results against past activity to determine shifts in trends. D. Solicits opinions from experts, summarizes the opinions, and feeds the summaries back to the experts without revealing participants to each other.

C. Analyzes current results against past activity to determine shifts in trends.

In a regression analysis, the coefficient of determination (r 2) A. Tests that the independent variable has no correlation with the dependent variable. B. Identifies the causal factor in a linear model. C. Assesses how well a model can predict an outcome. D. Is the proportion of the variance in the independent variable that is predictable from the dependent variable.

C. Assesses how well a model can predict an outcome.

A chief executive officer (CEO) believes that a major competitor may be planning a new campaign. The CEO sends a questionnaire to key personnel asking for original thinking concerning what the new campaign may be. The CEO selects the best possibilities and then sends another questionnaire asking for the most likely option. The process employed by the CEO is called the A. Simulation technique. B. Simple regression. C. Delphi technique. D. Least squares technique.

C. Delphi technique.

An automobile parts manufacturer has received complaints from customers about declining quality. After a quick review, management realizes the problem has no single source. To perform a thorough process of problem identification, the most appropriate tool is a(n) A. Pareto diagram. B. Statistical control charts. C. Fishbone diagram. D. Histogram.

C. Fishbone diagram.

Which of the following are key technologies of big data? In-memory analytics Data mining Text mining A. II only. B. I only. C. I, II, and III. D. I and III only.

C. I, II, and III.

Which of the following best describes unstructured data? A. Data systematically stored with markers to enforce hierarchies of records and fields within the data. B. Data with a high level of organization. C. Information that is not organized in a pre-defined manner (e.g., text-heavy facts, dates, numbers, and images). D. Conforms with the organization of data models associated with relational databases.

C. Information that is not organized in a pre-defined manner (e.g., text-heavy facts, dates, numbers, and images).

An organization wants to utilize business intelligence (BI) to assist in the evaluation of key metrics. The IT manager has suggested incorporating a dashboard feature in its BI tool. Which one of the following is the main reason that management should implement the dashboard feature? A. It allows management to have as many different charts as possible. B. It is designed to focus on metrics that have not been met. C. It shows patterns and trends in data across the organization. D. It can automatically generate reorders of important materials for production.

C. It shows patterns and trends in data across the organization.

For cost estimation, simple regression differs from multiple regression in that simple regression uses only A. One dependent variable, while multiple regression uses all available data to estimate the cost function. B. Dependent variables, while multiple regression can use both dependent and independent variables. C. One independent variable, while multiple regression uses more than one independent variable. D. One dependent variable, while multiple regression uses more than one dependent variable.

C. One independent variable, while multiple regression uses more than one independent variable.

The director of sales asks for a count of customers grouped in descending numerical rank by (1) the number of orders they place during a single year and (2) the dollar amounts of the average order. The visual format of these two pieces of information is most likely to be a A. Fishbone diagram. B. Kaizen diagram. C. Pareto diagram. D. Cost of quality report.

C. Pareto diagram.

Business intelligence (BI) has all of the following characteristics except A. Focusing on strategic objectives. B. Giving immediate information about an organization's critical success factors. C. Providing advice and answers to top management from a knowledge-based system. D. Displaying information in graphical format.

C. Providing advice and answers to top management from a knowledge-based system.

In the standard regression equation y = a + bx, the letter b is best described as a(n) A. Dependent variable. B. Independent variable. C. Slope of the regression line. D. Y intercept.

C. Slope of the regression line.

Which of the following best represents the application of predictive analytics? A. A consultant organizes an analysis of causation for dissatisfied workers and possible interactions among causes. B. A cost accountant monitors whether direct materials used are within the acceptable variations for the last 6 months. C. The website recommends pet toys and bedding after the customer purchases pet food. D. The human resource manager prepares an analysis to show which departments have the highest employee turnover.

C. The website recommends pet toys and bedding after the customer purchases pet food.

Each of the following represents a characteristic of big data except A. Mixture. B. Speed. C. Uniformity. D. Size.

C. Uniformity.

A cost accountant is updating its fourth quarter budget. The annual goal of cost savings is $56,000. The cost savings for the first, second, and third quarters are $12,000, $6,700, and $9,200. The accountant performed an analysis to determine the cost savings required for the fourth quarter to achieve the annual goal. This is an example of A. Monte Carlo simulation. B. Time series analysis. C. What-if analysis. D. Predictive analytics.

C. What-if analysis.

The letter x in the standard regression equation is best described as a(n) A. Constant coefficient. B. Coefficient of determination. C. Dependent variable. D. Independent variable.

D. Independent variable.

Which of the following forecasting methods relies mostly on judgment? A. Regression. B. Sensitivity analysis. C. Time series models. D. Delphi.

D. Delphi.

A regression equation A. Encompasses factors outside the relevant range. B. Is based on objective and constraint functions. C. Estimates the independent variable. D. Estimates the dependent variable(s).

D. Estimates the dependent variable(s).

A consultant is analyzing Company A's sales report on pants. The consultant has found that there are several unique patterns in the data. He noticed that there is a set of customers who purchased mainly one to two different types of pants in a year. This customer segment is the largest and is constantly growing. After further analyses he found that the pants purchased by each of these customers have different sizes. More analyses revealed that these customers are small clothing retail stores. The consultant then started to analyze how the company can improve supply chain management and business relationships with this specific customer segment to improve profitability. The method used in analyzing the problem is best described as a(n) A. Monte Carlo simulation. B. Sensitivity analysis. C. Regression analysis. D. Exploratory data analysis.

D. Exploratory data analysis.

Which of the following is a primary advantage of a what-if analysis? A. It results in a reduction of data and strengthened data integrity. B. It allows users to determine the effects of outcomes in all scenarios. C. It summarizes opinions from many experts and feeds the summaries back to the experts without revealing participants to each other. D. It enables users to evaluate their outcomes by applying a goal seeking approach.

D. It enables users to evaluate their outcomes by applying a goal seeking approach.

The type of data analytics that is most likely to yield the most impact for an organization but is also the most complex is called A. Descriptive analysis. B. Predictive analysis. C. Diagnostic analysis. D. Prescriptive analysis.

D. Prescriptive analysis.

Which of the following can be discovered using a data-mining process? A. Standard query reporting. B. Artificial intelligence. C. Data structure. D. Previously unknown information.

D. Previously unknown information.

An analyst is preparing a time series analysis for the sales of swimwear. He notices that, for the last 3 years, the swimwear sales rise during May and August and fall during November and February. Which of the following patterns best describes this scenario? A. Irregular pattern. B. Chronological pattern. C. Cyclical pattern. D. Seasonal pattern.

D. Seasonal pattern.

All of the following are correct statements regarding velocity-based value except A. The computing power required to quickly process huge volumes and varieties of data can overwhelm a single server or multiple servers. Organizations must apply adequate computer power to big data tasks to achieve the desired velocity. B. The faster businesses can inject data into their data and analytics platform, the more time they will have to ask the right questions and seek answers. C. Rapid analysis capabilities provide businesses with the right decision in time to achieve their customer relationship management objectives. D. The more data businesses have on the customers, both recent and historical, the greater the insights.

D. The more data businesses have on the customers, both recent and historical, the greater the insights.

Which of the following techniques are most effective in identifying trends and patterns? A. Exploratory data analysis, Pareto diagrams, scatter plots. B. Line charts, scatter plots, Delphi approach. C. Fishbone diagrams, time series analysis, predictive analytics. D. Time series analysis, exploratory data analysis, predictive analytics.

D. Time series analysis, exploratory data analysis, predictive analytics.

Corporation B recently hired a financial analyst to improve its financial results. The analyst is interested in implementing a new type of project analysis that will help evaluate the effects of small changes in advertising expenses on sales. The analyst believes that this form of analysis will be useful in forecasting the impacts of resource allocation decisions. What type of analysis is the analyst attempting to implement? A. The goodness-of-fit test. B. Fishbone diagrams. C. Delphi approach. D. What-if analysis.

D. What-if analysis.

Box Co. uses regression analysis to estimate the functional relationship between an independent variable (cost driver) and overhead cost. Assume that the following equation is being used: y = a + bx What is the symbol for the independent variable? A. bx. B. a. C. y. D. x.

D. x.

In preparing the annual profit plan for the coming year, Wilkens Company wants to determine the cost behavior pattern of the maintenance costs. Wilkens has decided to use linear regression by employing the equation y = a + bx for maintenance costs. The prior year's data regarding maintenance hours and costs, and the results of the regression analysis, are given below and in the opposite column. Average cost per hour $9.00 a 684.65 b 7.2884 Standard error of a 49.515 Standard error of b .12126 Standard error of the estimate 34.469 r2 .99724 Hours of Maintenance Activity Costs January 480 $ 4,200 February 320 3,000 March 400 3,600 April 300 2,820 May 500 4,350 June 310 2,960 July 320 3,030 August 520 4,470 September 490 4,260 October 470 4,050 November 350 3,300 December 340 3,160 Sum 4,800 $43,200 Average 400 $ 3,600 Question: 59 If Wilkens Company uses the high-low method of analysis, the equation for the relationship between hours of activity and maintenance cost would be A. y = 3,600 + 400x B. y = 570 + 9.0x C. y = 400 + 9.0x D. y = 570 + 7.5x

D. y = 570 + 7.5x