ISOM 201 Midterm

Question 1

What is Quantitative Analysis?

Answer 1

a scientific approach to
managerial decision making in which raw data
are processed and manipulated to produce
meaningful information

Question 2

Order of Quantitative Analysis

Answer 2

Raw data>Quantitative analysis> Meaningful Information

Question 3

What are Quantitative factors

Answer 3

data that can be accurately calculated

Question 3

Examples of Quantitive Analysis

Answer 3

diffrent investment alternatives
intrest rates
inventory levels
demand
labor cost

Question 4

what are qualitative factors

Answer 4

difficult to quantify but effect the decision process

Question 5

examples of qualitative factors

Answer 5

the weather
state/federal legislation
technological breakthroughs

Question 6

what is profit

Answer 6

profit= revenue - costs

Question 7

what is breakeven

Answer 7

0= revenue - costs

Question 8

what is a mean

Answer 8

average of a range of values

Question 9

what is a median

Answer 9

the middle of a set of values

Question 10

what is a mode

Answer 10

the most frequent number in a set of values

Question 11

what are the types of probability

Answer 11

Subjective Approach
Objective Approach
Relative Frequency Approach

Question 12

what is subjective approach

Answer 12

used when logic and past history is not available or appropriate

Question 13

Examples of Subjective approach

Answer 13

opinion polls
judgement by other experts

Question 14

What is Objective approach

Answer 14

Probabilities can be logically determined

Question 15

Examples of Objective Approach

Answer 15

Rolling Dice
Coin Toss

Question 16

What is Relative Frrequency Approach

Answer 16

objective probability assesment
P(event) = Number of occurances
/ total number of outcome

Question 17

What are the 5 types of event relationships

Answer 17

Independent Events
Dependent Events
Mutually Exclusive Events
Collectively Exhaustive Events
Complements Law

Question 18

what are the 3 types of decsion making

Answer 18

certainty- knows
uncertainty- doesnt know
risk - knows probabilty of outcomes

Question 19

5 critrea under uncertainty

Answer 19

Maximax (optimistic)
Maximin (pessimistic)
Criterion of realism (Hurwicz)
Equally likely (Laplace)
Minimax (regret)

Question 20

What is linear programming

Answer 20

a mathematical modeling technique used to help make
management decisions when trying to effectively use limited
resources

Question 21

4 requirements for linear programming

Answer 21

Seek to maximize or minimize some quantity (the objective function)

Restrictions or constraints are present

Alternative courses of action are available

Linear equations or inequalities

Question 22

7 properties of Linear Programs

Answer 22

one objective function
one (or more) constraints
alternative course of action
Objective and constraints are linear
Certainty
Divisibility
nonnegative variables

Question 23

What is Slack

Answer 23

slack is resources not used
amount of resources - resources used

Question 24

what is Surplus

Answer 24

when resources exceed constraints
actual amount - minimum amount

Question 25

equation to break even or profit

Answer 25

X= P + F / S - V
(X= profit + fixed costs/ selling price - variable costs)