Quiz 1 | DECISION ANALYSIS | Midterm

This quiz was locked Mar 12 at 11:59pm.

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LATEST Attempt 1 35 minutes 20 out of 30 *

* Some questions not yet graded

Score for this quiz: 20 out of 30 *

Submitted Mar 12 at 8:36pm
This attempt took 35 minutes.
 
Question 1
1 / 1 pts
For a maximization problem, the optimistic approach is often referred to as the

  minimax approach
 

  maximin approach
 Correct!

  maximax approach
 

  minimin approach
 

 
Question 2
1 / 1 pts
States of nature

Correct!
  can describe uncontrollable natural events such as floods or freezing temperatures.
 

  can be selected by the decision maker.

 

  cannot be enumerated by the decision maker.

 

  All of the alternatives are true. 

 
Question 3
1 / 1 pts
When consequences are measured on a scale that reflects a decision maker's attitude toward profit, loss, and risk, payoffs
are replaced by

Correct!
  utility values. 
  multicriteria measures.
 

  sample information.
 

  opportunity loss.
 
 
Question 4
1 / 1 pts
Which of the following approaches to decision making requires knowledge of the probabilities of the states of nature?

  minimax regret
 

  maximin 
Correct!
  expected value
 

  conservative
 

 
Question 5
1 / 1 pts
When the decision maker prefers a guaranteed payoff value that is smaller than the expected value of the lottery, the
decision maker isCorrect!

  a risk avoider.

 

  a risk taker.

 

  an optimist.
 

  an optimizer.
 
Question 6
1 / 1 pts
Statement I: Square nodes in a decision tree indicate that a decision must be made.
Statement II: The expected value of an alternative can never be negative.

  True, True
 
Correct!
  True, False
 

  False, True
 

  False, False
 

 
Question 7
1 / 1 pts
A payoff

  is always measured in profit

 

  is always measured in cost

 
Correct!
  exists for each pair of decision alternative and state of nature.
 

  exists for each state of nature

 

 
Question 8
1 / 1 pts
For a minimization problem, the conservative approach is often referred to as the

Correct!
  minimax approach
 

  maximin approach
 

  maximax approach
 

  minimin approach 
 
Question 9
1 / 1 pts
Decision tree probabilities refer to the probability of

Correct!
  an uncertain event occurring
 

  the decision being made.

 
  finding an optimal value.
 

  overlooked choices.
 

 
Question 10
1 / 1 pts
The efficiency of sample information is

  EVSI*(100%)
 
Correct!
  EVSI/EVPI*(100%)
 

  EVwoSI/EVwoPI*(100%)
 

  EVwSI/EVwoSI*(100%)
 

 
Question 11
1 / 1 pts
To find the EVSI,

  use the EVPI to calculate sample information probabilities.

 
  use indicator probabilities to calculate prior probabilities.
 
Correct!
  use prior and sample information probabilities to calculate revised probabilities
 

  use sample information to revise the sample information probabilities.

 

 
Question 12
1 / 1 pts
Statement I: States of nature should be defined so that one and only one will actually occur.
Statement II: Decision alternatives are structured so that several could occur simultaneously.

  True, True
Correct!
  True, False
  False, True
 

  False, False
 

Question 13
1 / 1 pts
A decision tree

  presents all decision alternatives first and follows them with all states of nature.
 

  presents all states of nature first and follows them with all decision alternatives.
 

  alternates the decision alternatives and states of nature.

 ect!

  arranges decision alternatives and states of nature in their natural chronological order.
 

 
Question 14
1 / 1 pts
For a minimization problem, the optimistic approach is often referred to as the

  minimax approach
 

  maximin approach
 

  maximax approach
 
Correct!
  minimin approach
 
 
Question 15
1 / 1 pts
In an influence diagram, decision nodes are represented by

  circles or ovals
Correct!
  squares or rectangles 
  diamonds 
  triangles
 

 
Question 16
1 / 1 pts
The options from which a decision maker chooses a course of action are

  called the decision alternatives.

 

  under the control of the decision maker.

 

  not the same as the states of nature. 

Correct!
  All of the alternatives are true.
 

 
Question 17
1 / 1 pts
Which of the following is not an advantage of using decision tree analysis?

  the ability to see clearly what decisions must be made

  the ability to see clearly in what sequence the decisions must occur
  the ability to see clearly the interdependence of decisions
  the ability to see clearly the future outcome of a decision
 

 
Question 18
1 / 1 pts
Statement I: Expected value is the sum of the weighted payoff possibilities at a circular node in a decision tree.
Statement II: EVPI is always greater than or equal to EVSI.

Correct!
  True, True
  True, False
  False, True
  False, False
 

 
Question 19
1 / 1 pts
For a maximization problem, the conservative approach is often referred to as the

  minimax approach.
Correct!
  maximin approach.
  maximax approach.
  minimin approach.
 

 
Question 20
1 / 1 pts
Statement I: After all probabilities and payoffs are placed on a decision tree, the decision maker calculates expected values
at state of nature nodes and makes selections at decision nodes.
Statement II:  A decision strategy is a sequence of decisions and chance outcomes, where the decisions chosen depend on
the yet to be determined outcomes of chance events.

rrect!
  True, True
  True, False
  False, True
  False, False
 

 
Question 21
Not yet graded / 2 pts
A regional fast-food restaurant is considering an expansion program. The major factor influencing the success of such a
program is the future level of interest rates. It is estimated that there is a 20 percent chance that interest rates will increase
by 2 percentage points, a 50 percent chance that they will remain the same, and a 30 percent chance that they will
decrease by 2 percentage points. The alternatives they are considering and possible payoffs are shown in the table below. 
Which alternative is best, based on expected value?

                                      Rates up                  Rates                Rates down

                                      2 percent             unchanged             2 percent
Build 50 restaurants     -$200,000              $50,000               $150,000
Build 25 restaurants     -$115,000              $26,000                 $80,000
Do nothing                     -$70,000                     0                       $5,000

Your Answer:
The fast-food restaurant should build more fifty (50) restaurants for it has the highest expected value which is $30,000.

 
Question 22
Not yet graded / 8 pts
A payoff table is given as

State of Nature

Decision s1 s2 s3

d1 250   750   500

d2 300 -250 1200

d3 500   500   600

a. What choice should be made by the optimistic decision maker? (2 points)

b. What choice should be made by the conservative decision maker? (2 points)

c. What decision should be made under minimax regret? (2 points)

If the probabilities of d1, d2, and d3 are .2, .5, and .3, respectively, then what choice should be made under
expected value? (2 points)

d.

Your Answer:
A. The optimistic decision maker should choose D2.
 
B. The conservatice decision maker should choose D3.
 
C. D1 should be made under minimax regret.
 
D. D1 should be made under expected value because it has the highest expected value.

Quiz Score: 20 out of 30

Quiz 2 | TIME SERIES ANALYSIS AND FORECASTING | Midterm

This quiz was locked Mar 19 at 11:59pm.
Attempt History
Attempt Time Score

LATEST Attempt 1 5 minutes 19 out of 30

Score for this quiz: 19 out of 30
Submitted Mar 19 at 9:59pm
This attempt took 5 minutes.
 
Question 1
0 / 1 pts
Statement I: The exponential smoothing forecast for any period is a weighted average of all the previous actual values for
the time series.
Statement II: The mean squared error is influenced much more by large forecast errors than is the mean absolute
error.Answered

  True, False
  
 
Question 2
1 / 1 pts
One measure of the accuracy of a forecasting model is the

Correct!
mean absolute error
 

Question 3
1 / 1 pts
Gradual shifting of a time series to relatively higher or lower values over a long period of time is called

Correct!
  trend.
 

 
Question 4
1 / 1 pts
Forecast errors

Correct!
  are the differences between actual and forecast values
 
 

 
Question 5
1 / 1 pts
Seasonal patterns

 
Correct!
  are regular repeated patterns.
 
 

 
Question 6
1 / 1 pts
Statement I: A four-period moving average forecast for period 10 would be found by averaging the values from periods 10,
9, 8, and 7.
Statement II: With fewer periods in a moving average, it will take longer to adjust to a new level of data values.

!
  False, False
 

 
Question 7
1 / 1 pts
Which of the following exponential smoothing constant values puts the same weight on the most recent time series value
as does a 5-period moving average?

  α = .2
 
 

 
Question 8
1 / 1 pts
Statement I: Time series methods base forecasts only on past values of the variables.
Statement II: Trend in a time series must be linear.

  True, False
 
Question 9
1 / 1 pts
Using a naive forecasting method, the forecast for next week’s sales volume equals

Correct!
  the most recent week’s sales volume
 
 

 
Question 10
1 / 1 pts
All of the following are true about time series methods except

  They involve the use of expert judgment to develop forecasts.

 
 
Question 11
0 / 2 pts
Use a Linear trend projection to forecast attendance at baseball games. Historical records show

5346, 7812, 6513, 5783, 5982, 6519, 6283, 5577, 6712, 7345
What is the forecast at the 1st period?

Correct Answers
Between 6,178 and 6,179

Question 12
0 / 2 pts
A hospital records the number of floral deliveries its patients receive each day. For a two-week period, the records show

15, 27, 26, 24, 18, 21, 26, 19, 15, 28, 25, 26, 17, 23

Use exponential smoothing with a smoothing constant of .4 to forecast the number of deliveries.
What is the forecast at the 5th period?

Correct Answers
Between 22 and 23

 
Question 13
2 / 2 pts
The number of girls who attend a summer basketball camp has been recorded for the seven years the camp has been
offered. Use moving averages with k=4 to forecast attendance for the fifth year

47, 68, 65, 92, 98, 121, 146

Correct!
68

Correct Answers
68 (with margin: 0)

 
Question 14
2 / 2 pts
Use a Naive forecasting method to forecast attendance at baseball games. Historical records show

5346, 7812, 6513, 5783, 5982, 6519, 6283, 5577, 6712, 7345
 
What is the forecast at the 11th period?

Correct!
7,345

Correct Answers
7,345 (with margin: 0)

 
Question 15
2 / 2 pts
Use a Linear trend projection to forecast attendance at baseball games. Historical records show

5346, 7812, 6513, 5783, 5982, 6519, 6283, 5577, 6712, 7345
 
What is the forecast at the 5th period?

Correct!
6,364.02

Correct Answers
Between 6,364 and 6,365

 
Question 16
0 / 2 pts
A hospital records the number of floral deliveries its patients receive each day. For a two-week period, the records show

15, 27, 26, 24, 18, 21, 26, 19, 15, 28, 25, 26, 17, 23
Use weighted average with k=2 and a percentage of 35% and 65% , respectively.
What is the forecast at the 5th period

You Answered

Correct Answers
21.9 (with margin: 0)

 
Question 17
2 / 2 pts
Use a four-period moving average to forecast attendance at baseball games. Historical records show

5346, 7812, 6513, 5783, 5982, 6519, 6283, 5577, 6712, 7345
 
What is the forecast at the 7th period?

Correct!
6,199.25

Correct Answers
Between 6,199 and 6,200

 
Question 18
0 / 2 pts
The number of girls who attend a summer basketball camp has been recorded for the seven years the camp has been
offered. Use exponential smoothing with a smoothing constant of .8 to forecast attendance for the fourth year.
47, 68, 65, 92, 98, 121, 146
 

You Answered

Correct Answers
Between 64 and 65

 
Question 19
0 / 2 pts
The number of cans of soft drinks sold in a machine each week is recorded below. Develop forecasts using a three-period
moving average. What is the forecasts at the 11th period?

338, 219, 278, 265, 314, 323, 299, 259, 287, 302

Correct Answers
Between 282 and 283

 
Question 20
2 / 2 pts
The number of cans of soft drinks sold in a machine each week is recorded below. Develop forecasts using a average past.
What is the forecasts at the 9th period?

338, 219, 278, 265, 314, 323, 299, 259, 287, 302

Correct!
286.88
Correct Answers
Between 286 and 287

Quiz 3 | INVENTORY MODLES | Midterm

Score for this quiz: 30 out of 30
Submitted Mar 24 at 9:28pm
This attempt took 33 minutes.
 
Question 1
1 / 1 pts
For inventory systems with constant demand and a fixed lead time,

Correct!
  the reorder point = lead-time demand.
 

  the reorder point > lead-time demand.

 

  the reorder point < lead-time demand.

 

  the reorder point is unrelated to lead-time demand.

 

 
Question 2
1 / 1 pts
The EOQ model
  determines only how frequently to order.
 
Correct!
  considers total cost.
 

  minimizes both ordering and holding costs.

 

  All of the alternatives are correct.

 

 
Question 3
1 / 1 pts
Statement I: The time between placing orders is the lead time.
Statement II: When quantity discounts are available, order an amount from the highest discount category.

  False, False
 

 
Question 4
1 / 1 pts
Safety stock

  can be determined by the EOQ formula.

  depends on the inventory position. 
Correct!
  depends on the variability of demand during lead time.
  is not needed if Q* is the actual order quantity. 
Question 5
1 / 1 pts
Which cost would not be considered part of a holding cost?

  cost of capital
  shipping cost
  insurance cost
  warehouse overhead
 

 
Question 6
1 / 1 pts
Statement I: To be considered as inventory, goods must be finished and waiting for delivery.
Statement II: When demand is independent, it is not related to demand for other components or items produced by the
firm.

Correct!
  False, True
 
Question 7
1 / 1 pts
Statement I: The terms "inventory on hand" and "inventory position" have the same meaning.
Statement II: As lead time for an item increases, the cycle time increases.
!
  False, False
 

Question 8
1 / 1 pts
Statement I: Constant demand is a key assumption of the EOQ model.
Statement II: In the EOQ model, the average inventory per cycle over many cycles is Q/2.

Correct!
  True, True
  
 
Question 9
1 / 1 pts
The objective of the EOQ with quantity discounts model is to

  determine the minimum order quantity required for the maximum discount. 
  balance annual ordering and holding costs.
  minimize annual purchase cost.
 

  minimize the sum of annual carrying, holding, and purchase costs.

 

 
Question 10
1 / 1 pts
Inventory
  is held against uncertain usage so that a supply of items is available if needed.
 

  constitutes a small part of the cost of doing business.

 

  is not something that can be managed effectively.

 

  All of the alternatives are correct.

 

 
Question 11
6 / 6 pts
Zip Games purchases blank DVD disks onto which it copies its software for sale through its mail order operation. A disk
costs Zip $.20. Processing an order for more disks cost $15. Zip uses 60000 disks annually, and the company has a 25%
cost of capital.
6000

(A) What is the EOQ? 

10

(B) How many orders are placed annually? (Note that number of orders per year is computed as AD/Q) 
36.5
(C) How frequently will orders be placed? 

Answer 1:
Correct!6000 
Answer 2:
Correct!10
Answer 3:
Correct!36.5

 
Question 12
2 / 2 pts
Show the total cost expression and calculate the EOQ for an item with holding cost rate 18%, unit cost $8.00, annual
demand of 40000, and ordering cost of $48.
(Round off your answer to whole number)

Correct!
1,633

Correct Answers
1,633 (with margin: 0)

 
Question 13
3 / 3 pts
Bank Drugs sells Jami Michelle lipstick. The Jami Michelle Company offers a 6% discount on orders of at least 500 tubes, a
10% discount on orders of at least 1,000 tubes, a 12% discount on orders of at least 1,800 tubes and a 15% discount on
orders at least 2,500 tubes.

Bank sells an average of 40 tubes of Jami Michelle lipstick weekly. The normal price paid by Bank drugs is $1 per tube. If it
costs Bank $30 to place an order, and Bank's annual holding cost rate is 27%, determine the optimal order policy for Bank
Drugs.

Correct!
1,000

Correct Answers
1,000 (with margin: 0)

Question 14
4 / 4 pts
Kellam Images prints snack food bags on long rolls of plastic film. The plant operates 250 days a year. The daily production
rate is 6000 bags, and the daily demand is 3500 bags. The cost to set up the design for printing is $300. The holding cost is
estimated at 2 cents per bag.
250998

(A) What is the recommended production lot size? (Round off your answer to whole number) 
17500
(B) If there is a five-day lead time to set up the line, what is the recommended reorder point? 

Answer 1:
Correct!250998
Answer 2:
Correct!17500
 

Question 15
5 / 5 pts
The Super Discount store (open 24 hours a day, every day) sells 8-packs of paper towels, at the rate of approximately 420
packs per week. Because the towels are so bulky, the annual cost to carry them in inventory is estimated at $.50. The cost
to place an order for more is $20 and it takes four days for an order to arrive.
1322

(A) Find the optimal order quantity. (Round off to whole number) (2 pts) 
240

(B) What is the reorder point? (2 pts) 

22
(C) How often should an order be placed? (1 pt) 

Answer 1:
Correct!1322 
Answer 2:
Correct!240
Answer 3:
Correct!22