SCM 312 Midterm
Which of the following is the mathematical model for deriving the break-even volume?
Q = F / (C -V)
The closer alpha is to one, the ______ the model responds to changes in the time series.
Quicker
When data are classified by the type of measurement scale, which is the strongest form of measurement?
Ratio
Regression Analysis requires....
Regression analysis requires numerical data.
Statistical Forecasting Models
Simple moving average, Exponential smoothing, Regression Analysis
Which of the following charts shows three-dimensional data?
Surface chart
Which of the following is the mathematical model for deriving total cost of only outsourcing?
TC = Q x C
Net Present Value
(or discounted cash flow) measures the worth of a stream of cash flows, taking into account the time value of money
Discrete Metric
- one that is derived from counting something. For example, a delivery is either on time or not; an order is complete or incomplete; or an invoice can have one, two, three, or any number of errors. Some discrete metrics would be the proportion of on-time deliveries; the number of incomplete orders each day, and the number of errors per invoice.
=OR(condition1, condition2, ...)
- returns TRUE if any condition is true and FALSE if not.
Descriptive Analytics
A manager at Gampco Inc. wishes to know the company's revenue and profit in its previous quarter. Which of the following business analytics will help the manager?
IBM Cognos Express
An integrated business intelligence and planning solution designed to meet the needs of midsize companies, provides reporting, analysis, dashboard, scorecard, planning, budgeting and forecasting capabilities
Frequency distributions and histograms can be created using the ________ in Excel.
Analysis Tool pac
Nominal data:
Are sorted into categories according to specific characteristics
Peige, a stock broker, has data consisting of price, price/earnings ratio, and market capitalization for seven different stocks on one particular day. She wishes to plot these three variables in two dimensions. Which of the following charts must Peige use?
Bubble Chart
Which of the following inputs of a decision model is an example of data?
COSts
Roger wants to compare values across categories using vertical rectangles. Which of the following charts must Roger use?
Clustered column chart
Ratio Data
Continuous and has natural zero ex: Money
a collection of data. Examples: Marketing survey responses, a table of historical stock prices, and a collection of measurements of dimensions of a manufactured item.
Data Set
a collection of related files containing records on people, places, or things. A database file is usually organized in a two-dimensional table, where the columns correspond to each individual element of data (called fields, or attributes), and the rows represent records of related data elements.
Database
Examine historical data for similar products (prices, units sold, advertising
Descriptive Analytics
Categorical data can be included as independent variables, but must be coded numeric using ______variables.
Dummy
In a database, information is stored and maintained in ________
Entities
Steps to make relative frequency distribution
First, sum the frequencies to find the total number (note that the sum of the frequencies must be the same as the total number of observations, n). Then divide the frequency of each category by this value.
A graphical depiction of a frequency distribution for numerical data in the form of a column chart is called a
Histogram
Multiple Linea Regression
Involves more than 2 independent variables
Pareto Analysis
Involves sorting data and calculating cumulative proportions.
Following are the components of a data set containing purchase details of a shoe manufacturing company. Identify the ratio data.
Item cost
An ______ occurs when the effect of one variable is dependent on another variable.
Interaction
Dates
Interval
Which of the following charts provides a useful means for displaying data over time?
Line chart
Three error metrics used for measuring forecast accuracy
Mean Absolute Deviation, Mean square error, Mean absolute percentage error
numerical values associated with a metric.
Measures
Mean Square error
Most commonly used metric It penalizes larger errors because squaring larger numbers has a greater impact than squaring smaller numbers
| r |, where r is the sample correlation coefficient. The value of r varies from -1 to +1 (r is negative if slope is negative)
Multiple R
How to implement news vender Idea
Must determine what each good costs to buy (C), how much revenue you get from each unit (R), and what the salvage value is for any unsold goods (S) → R>C>S
a street vendor sells daily newspapers and must decide each day how many to purchase. If he purchases too few, there will be a lost opportunity to increase profits, but if he purchases too many, he will have to throw those away at the end of the day, which results in a loss
Newsvender example
Explain how regression techniques can be used to forecast with explanatory or causal variables
Often called econometric models), seek to identify factors that explain statistically the patterns observed in the variable being forecasted, usually with regression analysis.
Philip wishes to understand the relative proportion of each data source to the total. Which of the following charts must Philip use?
Pie Chart
A trader who wants to predict short-term movements in stock prices is likely to use ________ analytics.
Predictive
detects patterns in historical data and extrapolates them forward in time.
Predictive analytics
SAS Analytics
Predictive modeling and data mining, visualization, forecasting, optimization and model management, statistical analysis, text analytics, and more.
Which decision model incorporates the process of optimization?
Prescriptive
In the Purchase Orders database, to find the total cost of all airframe fasteners, use
SUMIF(D4:D97,"Airframe fasteners", G4:G97)
Observations consisting of pairs of variable data are required to construct a ________ chart
Scatter Chart
Categorical (Nominal) Data
Specific characteristics. Ex. Words, Item Numbers/Classifications
variability between observed and predicted Y values. This is formally called the standard error of the estimate,
Standard Error
Apply moving average and exponential smoothing models to ________ time series.
Stationary time series
Mean absolute Deviation
The absolute difference between the actual value and the forecast, averaged over a range of forecasted values
Mean Absolute percentage Error
The average of absolute errors divided by actual observation values
Which of the following is a disadvantage of ordinal data?
They have no fixed units of measurement
To select a chart type in Excel from the Charts group, which tab has to be accessed?
To select a chart type in Excel from the Charts group, which tab has to be accessed?
Interval Data
Which of the following allow meaningful comparison of ranges, averages and other statistics?
Regression Analysis
Used for long term forecasting
The demand for coffee beans over a period of three months has been represented in the form of an L-shaped curve. Which form of model was used here?
Visual model
Which of the following is an example of a measure of continuous metrics?
Weight and steel
Which of the following questions will prescriptive analytics help a company address?
What is the best way of shipping goods from their factories to minimize costs?
Delphi Method
uses a panel of confidential (from one another) experts to respond to questionnaires in order to evaluate
=IF(condition, value if true, value if false)
a returns one value if the condition is true and another if the condition is false,
Metric
a unit of measurement that provides a way to objectively quantify performance.
Exponential Smoothing
a versatile, yet highly effective approach for short-range forecasting Forecast + Alpha(Observed Value - Forecast)
Influence Diagram
a visual representation of a descriptive model that shows how the elements of the model influence, or relate to, others. An influence diagram is a useful approach for conceptualizing the structure of a model and can assist in building a mathematical or spreadsheet model.
Deterministic
all model input information is known with certainty.
Decision Model
an abstraction or representation of a real system, idea, or object. Captures the most important features Can be a written or verbal description, a visual representation, a mathematical formula, or a spreadsheet.
Model
an abstraction or representation of a real system, idea, or object. Captures the most important features Can be a written or verbal description, a visual representation, a mathematical formula, or a spreadsheet.
Ordinal Data
can be ordered or ranked according to some relationship to one another. ex: rankings, order numbers
Decision Variables
can be selected at the discretion of the decision maker.
R Square
coefficient of determination, R2, which varies from 0 (no fit) to 1 (perfect fit)
COUNTA
counts the number of nonblank cells in a range
Validity
data correctly measures what it is supposed to measure.
Prescriptive decision models help:
decision makers identify the best solution to decision problems.
Descriptive Decision models
describe relationships but do not tell a manager what to do.
Frequency distribution can be constructed for both
discrete and continuous data
Historical Analogy
forecast is obtained through a comparative analysis with a previous situation → ex: if a new product is being produced, the response of customers to marketing campaigns of similar products can be looked at as a guide for the new product's market campaign
Prescriptive Analytics
identify the best alternatives to minimize or maximize some objective. ex: Find the best sets of pricing and advertising to maximize sales revenue
To construct a frequency distribution, we need only count the number of observations that appear
in each category using COUNTIF Function
Simple Linear Regression
involves a single independent variable.
Frequency Distribution
is a table that shows the number of observations in each of several nonoverlapping groups.
Relative Frequency Distribution
is a tabular summary of the relative frequencies of all categories.
Regression Analysis
is a tool for building mathematical and statistical models that characterize relationships between a dependent (ratio) variable and one or more independent, or explanatory variables (ratio or categorical), all of which are numerical.
Risk
is associated with the consequences of what actually happens.
Uncertainty
is imperfect knowledge of what will happen in the future.
Business Analytics
is the use of: data, information technology, statistical analysis, quantitative methods, and mathematical or computer-based models to help managers gain improved insight about their business operations and make better, fact-based decisions.
B$4
keeps the reference fixed to row 4 but allows the column reference to change if the formula is copied to another cell.
$B$4
keeps the reference to cell B4 fixed no matter where the formula is copied.
$B4
keeps the reference to column B fixed but allows the row reference to change.
=VLOOKUP(lookup_value, table_array, col_index_num, [range lookup]) -
looks up a value in the leftmost column of a table and returns a value in the same row from a column you specify
=HLOOKUP(lookup_value, table_array, row_index_num, [range lookup]) -
looks up a value in the top row of a table and returns a value in the same column from a row you specify.
Indicators and Indexes
measures that are believed to influence the behavior of variable we wish to forecast
Interval Data
ordinal but have constant differences between observations and have arbitrary zero points. Dates
Predictive Analytics
predict the future by examining historical data, detecting patterns or relationships in these data, and then extrapolating these relationships forward in time. Ex. Predict sales based on price
Information
result of analyzing data; that is, extracting meaning from data to support evaluation and decision making.
=AND(condition1, condition2, ...)
returns TRUE if all conditions are true and FALSE if not,
Simple Moving Average
smoothing method based on the idea of averaging random fluctuations in the time series to identify the underlying direction in which the time series is changing (k = 3, 5, 12, etc.)
Stochastic
some model input information is uncertain.
Measurement
the act of obtaining data associated with a metric.
Descriptive Analytics
the use of data to understand past and current business performance and make informed decisions
When will a company use a predictive decision model?
when it wishes to know sales patterns to plan inventory levels