BSNS 6001 Exam 2

Instructions

1. Using Microsoft Excel, respond to the Exam Questions shown on the next page.

2. This is an Individual Exam. No collaboration with other students is allowed.

3. Place your responses in the “Exam 2 Template” Excel file.

4. Show all work and/or Excel computations and output. Merely stating the final answer is not acceptable. You will
also be graded on your work for each Exam Question. Note that Excel tools and functions need to be used as
needed for each Exam Question.

5. One Excel file should be submitted. Use the file name: Exam 2 Template, YOURLASTNAME.xlsx. For example,
if your name is “John Doe”, your filename would be: : Exam 2 Template, Doe.xlsx

6. Submit your file in Canvas for this Assignment.

7. The submission approach described above is required in order to receive full credit for this Exam.

8. DUE DATE/TIME: 7/3/16, 11:59PM (Nampa time)

9. Note that since 7/3/16 is the last day of the course, this Exam must be submitted on-time.

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 BSNS 6001 Exam 2

Please respond to the following questions.

1. Acme Systems, Inc. produces a very large volume of plastic rods on a regular basis. These rods
require an extremely accurate diameter. Thus, the Quality Control manager wants to know if the
production process is producing rods at a consistent diameter. 300 rods have been sampled each day
for 10 days. Defects have been recorded. Develop a “p” control chart for the proportion of defects
across the 10 days. Assume Z = 3. Do any of the rods appear to be “out of control”? Comment on
your findings.

The data is included in the Exam 2 template.

2. Refer to Chapter 13, Problem 52 in the Lind et al. textbook:

Super Markets Inc. is considering expanding into the Scottsdale, Arizona, area. You as director of
planning must present an analysis of the proposed expansion to the operating committee of the board
of directors. As a part of your proposal, you need to include information on the amount people in the
region spend per month for grocery items. You would also like to include information on the relationship
between the amount spent for grocery items and income. Assume amount spent is the dependent
variable and monthly income is the independent variable.

Ignore the data in the textbook problem. Instead, use the data in the Exam 2 template.

Using Excel, run a regression analysis (ensure level of significance = 0.05). Ignore the questions in
the textbook problem. Instead, respond to the following:

a. Create a scatter diagram for the independent variable acting on the dependent variable. What
type of relationship exists? Explain your rationale.
b. What is the Null Hypothesis for the overall model?
c. What is the Alternative Hypothesis for the overall model?
d. What is the regression equation?
e. What is the standard error? Describe what this means as related to the problem.
f. Interpret the appropriate R2 value.
g. What does the overall statistical significance explain with respect to the model?

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3. Refer to Chapter 14, Problem 24 in the Lind et al. textbook:

The Times-Observer is a daily newspaper in Metro City. Like many city newspapers, the Times-
Observer is suffering through difficult financial times. The circulation manager is studying other
papers in similar cities in the United States and Canada. She is particularly interested in what
variables relate to the number of subscriptions to the paper. She is able to obtain the following
sample information on 25 newspapers in similar cities.

Ignore the data in the textbook problem. Instead, use the data in the Exam 2 template.

Using Excel, run a multiple regression analysis (ensure level of significance = 0.05). Ignore the
textbook questions in the problem. Instead, respond to the following:

a. What is the dependent variable?

b. What are the independent variables?
c. Create a scatter diagram for each independent variable acting on the dependent variable.
Comment.
d. What is the Null Hypothesis for the overall model?
e. What is the Alternative Hypothesis for the overall model?
f. What is the multiple regression equation?
g. What is the standard error? Describe what this means as related to the problem.
h. For your initial model equation, discuss whether R2 or Adjusted R2 should be used in interpreting
how good the linear equation is. Then, interpret the appropriate R2 value.
i. What does the overall statistical significance explain with respect to the model?
j. Evaluate the p-value for each independent variable. Should any of the independent variables be
dropped? Why or why not?
k. Develop a correlation matrix for the independent variables. Should any of the independent
variables be dropped? Why or why not?
l. Is this a good model?

4. A furniture manufacturer makes a mix of desks (D) and chairs (C). Each desk uses three units of
wood, and each chair uses five units of wood. Each desk generates a profit of $55, and each chair
generates $35 in profit. Production facilities are setup in such a way that the number of chairs
produced must be exactly 1.5 times the number of desks. The plant capacity is 100 pieces of
furniture a day. There are 190 units of wood available per day. The furniture manufacturer wishes to
find the optimal daily production combination of desks and chairs in order to maximize profit in a
given day.
a. State the Objective function mathematically.
b. State the constraints mathematically.
c. Setup the model in Excel and use Solver to determine the optimized solution.
d. How many desks should be produced?
e. How many chairs should be produced?
f. What is the overall daily profit?

Note that Excel formulas and Solver settings need to be correct in Microsoft Excel in order to have
an opportunity for full credit on this problem (even if the correct answers are shown). In addition, the
Instructor will be running Solver on your spreadsheets to ensure the optimal solution is obtained,
based on your model. Note: there is no need to specify results to be integer values.

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5. Customers arrive randomly at a product returns counter at a department store, which meets the
assumptions of the Single-Server, Single-Phase waiting line model (i.e., the arrival rate is Poisson
distributed and service rate is exponentially distributed). There is only one returns employee, and the
time required for returns varies from customer to customer. There is a single waiting line. The average
arrival rate is 16 customers per hour. The average time to serve a customer is 2.52 minutes. Respond
to the following questions:

a. What is the utilization factor?

b. How long can a customer expect to wait in line?
c. How many customers are expected to wait to be serviced?
d. How many customers are expected to be in the system?
e. How long can a customer expect to wait to be serviced and be serviced?
f. What is the probability that there are exactly 2 customers in the system?
g. What is the probability that there are exactly 5 customers in the system?

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