MGT 391 Quantitative Analysis Mid-Term Exam

Management Science

...Technique that can be applied to solve problems in different types of organizations, including services, government, military, business and industry, and health care.

True

A constraint is a linear relationship representing a restriction on decision making.

GAANT Chart

A graph or bar chart with a bar for each activity in a project, showing the passage of time.

Variance

A measure of dispersion.

True

A model is a mathematical representation of a problem situation including variables, parameters, and equations.

Management Science

A scientific approach to solving management problems.

Independent Events

A succession of events that do not affect each other are ~ .

Independent Events

A succession of events that do not affect each other.

True

A work breakdown structure is a structure that breaks down a project into its major subcomponents, components, activities, and tasks.

Frequency Distribution

A ~ organizes numerical data to describe the events of an experiment.

GAANT Chart

A(n) ~ chart is a graph or a bar chart for each activity that shows the project schedule and the passage of time.

True

All linear programming models exhibit a set of constraints.

Model Constraints

Are also linear relationships of the decision variables; they represent the restrictions placed on the firms by the operating environment. The restrictions can be in the form of limited resources or restrictive guidelines.

Variable Costs

Are determined on a per-unit basis. Thus, total ~ depend on the number of units produced. ~ include such items as raw materials and resources, direct labor, packaging, material handling, and freight.

Fixed Costs

Are generally independent of the volume of units produced and sold. That is, ~ remain constant, regardless of how many units of product are produced within a given range. ~ can include such items as rent on plant and equipment, taxes, staff and management salaries, insurance, advertising, depreciation, heat and light, and plant maintenance.

Fixed Costs

Are independent of volume and remain constant.

Project Teams

Are made up of individuals from various areas and departments within a company.

False

Fixed cost is the difference between total cost and total variable cost.

Mutually Exclusive

If only one event in an experiment can occur at a time.

Variance

Is a measure of dispersion of random variable values about the expected value.

Slack

Is the amount of time an activity can be delayed without delaying the project.

Model

It can be in the form of a graph or chart, but most frequently a management science model consists of a set of mathematical relationships. These mathematical relationships are made up of numbers and symbols.

Linear Programming Model

It consists of decision variables, an objective function, and constraints.

Objective Function

It is a linear relationship reflecting the objective of an operation.

Model Constraint

It is a linear relationship that represents a restriction on decision making.

Variance

It is a measure of the dispersion of random variable values around the expected value, or mean.

Project Crashing

It is a method for shortening project duration by reducing time of one or more of the critical project activities to a time that is less than the normal activity time.

Linear Programming

It is a model that consists of linear relationships representing a firm's decision(s), given an objective and resource constraints.

Feasible Solution Area

It is an area on the graph that is bounded by the constraint equations.

Subjective Probability

It is an estimate based on personal belief, experience, or knowledge of a situation.

Frequency Distribution

It is an organization of numeric data about the events in an experiment.

Work Breakdown Structure (WBS)

It is an organizational chart that breaks down the project into modules for planning.

Sensitivity Analysis

It is the analysis of the effect of parameter changes on the optimal solution.

Define the Decision Variables

It is the first step in formulating a linear programming model.

Critical Path

It is the longest path through the network; it is the minimum time in which the network can be completed.

Break-even Point

It is the volume that equates total revenue with total cost where profit is zero.

Sensitivity Analysis

It is used to analyze changes in model parameters.

Model

It's an abstract mathematical representation of a problem situation.

True

Linear programming is a model consisting of linear relationships representing a firm's decisions given an objective and resource constraints.

False

Linear programming problems are restricted to decisions in a single time period.

False

Management science involves the philosophy of approaching a problem in a subjective manner.

False

Management science techniques can be applied only to business and military organizations.

True

Objective probabilities that are stated after the outcomes of an event have been observed are relative frequencies.

Objective Probability

Of a specific outcome is the ratio of the number of specific outcomes to the total number of outcomes.

True

Project crashing is a method for shortening the project completion time by reducing the completion time of the one or more critical activities at a cost.

True

Project teams are made up of individuals from various areas and departments within a company.

Slack Variable

Represents unused resources.

False

Sensitivity analysis determines how a change in a parameter affects the optimal solution.

Project Crashing

Shortens the project time by reducing critical activity times at a cost.

True

Subjective probability is an estimate based on personal belief, experience, or knowledge of a situation.

False

The critical path is the shortest path through the project network.

True

The events in an experiment are mutually exclusive if only one can occur at a time.

Unbounded Problem

The objective function can increase indefinitely without reaching a maximum value.

First

The ~ step in formulating a linear programming model is to define the decision variables.

True

Variable costs depend on the number of items produced.

Unbound Problem

When a maximization problem is ~ , the objective function can increase indefinitely without reaching a maximum value.