Quiz No. 1 LBOMGTS PRESCRIPTIVE ANALYTICS OPTIMIZATION PDF

4/19/23, 11:06 PM Quiz No.
1: [1222_LBOMGTS_K46] - PRESCRIPTIVE ANALYTICS (OPTIMIZATION)
Quiz No. 1
Due Mar 3 at 3pm Points 42 Questions 42
Available Feb 21 at 9:15am - Mar 3 at 3:05pm Time Limit 80 Minutes
Instructions
Multiple Choice:
Choose the correct answer.
This quiz was locked Mar 3 at 3:05pm.
Attempt History
Attempt Time Score
LATEST Attempt 1 69 minutes 42 out of 42
Score for this quiz: 42 out of 42

Submitted Feb 21 at 10:24am
This attempt took 69 minutes.
Question 1 1 / 1 pts
A manager has determined that a potential new product can be sold at a

price of $10.00 each. The cost to produce the product is $5.00, but the
equipment necessary for production must be leased for $25,000 per year.
What is the break-even point?
Correct! 5,000 units.
2,500 units
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4/19/23, 11:06 PM Quiz No. 1: [1222_LBOMGTS_K46] - PRESCRIPTIVE ANALYTICS (OPTIMIZATION)
7,500 units.
10,000 units.
In order to produce a new product, a firm must lease equipment at a cost

of $10,000 per year. The managers feel that they can sell 5,000 units per
year at a price of $7.50. What is the highest variable cost that will allow
the firm to at least break even on this project?
$2.50.
Send
$3.50.
$4.50
Correct!
$5.50.
A cost that does not vary with the production volume would be a fixed
cost.
No answer text provided.
False
Correct!
True
A cost that does not vary with the production volume would be a variable
cost.
Correct!
False
True
Production has indicated that they can produce widgets at a cost of $4.00
each if they lease new equipment at a cost of $10,000. Marketing has
estimated the number of units they can sell at a number of prices (shown
below). Which price/volume option will allow the firm to avoid losing
money on this project?
Correct!
3,000 units at $7.50 each.
A manager has determined that a potential new product can be sold at a

price of $50.00 each. The cost to produce the product is $35.00, but the
equipment necessary for production must be leased for $100,000 per
year. What is the break-even point?
Correct!
6,667 units.
7,500 units.
3,333 units
5,000 units.
A manufacturer can sell a certain health supplement for P1,200 per unit.
Its total cost consists of a fixed overhead of Php 85,000 plus production
costs of Php 400 per unit. What is the manufacturer's profit or loss if 400
units are sold?
Correct!
Php 235,000
Php 155,000
Php 185,000
Php 245,000
As part of their course requirement, a group of students bakes pastries

and sells them. The rental for the oven is Php 600 for a day and the
baking costs add to roughly Php 30 per piece. The pastries can be sold for
Php 45 per piece. How many pieces must the students sell to make a
profit of Php 4,500?
640
220
320
Correct!
340
Which of the following is TRUE about the break-even point?
When sales are below the break-even point, profits will be positive.
Once sales exceed the break-even point, profits no longer change if sales
increase further.
Correct!
When sales are equal to the break-even point, profit will be zero.
When sales exceed the break-even point, profits will be negative.
Predictive analytics is the process of using data to.
determine the best course of action for the future.
determine the break-even point.
Correct!
predict what will happen in the future.
solve linear programming problems.
Prescriptive analytics is the process of using data to

_________________________________.
analyze trends.
Correct!
determine the best course of action for the future.
determine the break-even point.
predict what will happen in the future.
A group is planning a conference. The cost to rent the space is $1,000.

Each attendee will be charged $50.00 to attend, but the group provides a
lunch (the group will pay $10.00 for each lunch). What is the break-even
point?
30 attendees
Correct! 25 attendees.
35 attendees
20 attendees.
States of nature are alternatives available to a decision maker.
True
Correct! False
An example of maximax decision making is a person buying lottery tickets

in hopes of a very big payoff.
False
Correct! True
In decision analysis, states of nature refer to possible future conditions.
False
Correct! True
The maximin criterion is an optimistic criterion.
Correct! False
True
Bayes' decision rule says to choose the alternative with the largest
expected payoff.
False
Correct! True
Determining the worst payoff for each alternative and choosing the
alternative with the "best worst" is the criterion called:
maximax.
Bayes decision rule.
maximum likelihood.
Correct! maximin.
minimin.
Based on the following payoff table, answer the following:
Alternative High Low
Buy 90 −10
Rent 70 40
Lease 60 55
Prior Probability 0.4 0.6
The maximax strategy is:
Do nothing
Correct! Buy
Lease
Rent
Buy 90 −10
Rent 70 40
Lease 60 55
The maximin strategy is:
Correct! Lease
Rent
Buy
None of the given
Buy 90 −10
Rent 70 40
Lease 60 55
The Bayes' decision rule strategy is:
Do nothing
Correct!
Lease
Rent
Buy
Alternative Yes No
Small 10 30
Medium 20 40
Medium 30 45
Large
Large 40 35
Extra Large 60 20
Prior
0.3 0.7
Probability
The maximax strategy is:
medium large
large
small
Correct!
extra large
medium
Alternative Yes No
Small 10 30
Medium 20 40
Medium
30 45
Large
Large 40 35
Extra Large 60 20
Prior
0.3 0.7
Probability
The maximin strategy is:
medium
small
medium large
Correct!
large
extra large
Alternative Yes No
Small 10 30
Medium 20 40
Medium
30 45
Large
Large 40 35
Extra Large 60 20
Prior
0.3 0.7
Probability
Correct!
medium large
extra large
small
large
medium
Alternative High Medium Low
A 20 20 5
B 25 30 11
C 30 12 13
D 10 12 12
E 50 40 −28
Prior
0.3 0.2 0.5
Probability
The maximum likelihood strategy is:
Correct!
C
) Based on the following payoff table, answer the following:
Alternative High Medium Low
A 20 20 5
B 25 30 11
C 30 12 13
D 10 12 12
E 50 40 −28
Prior
0.3 0.2 0.5
Probability
Correct!
B
The operations manager for a local bus company wants to decide whether
he should purchase a small, medium, or large new bus for his company.
He estimates that the annual profits (in $000) will vary depending upon
whether passenger demand is low, moderate, or high, as follows.
Demand
Bus Low Medium High
Small 50 60 70
Medium 40 80 90
Large 20 50 120
Prior
0.3 0.3 0.4
Probability
If he uses the maximum likelihood criterion, which size bus will he decide
to purchase?
Medium
Correct!
Large
Small
Either Small or Medium
Demand
Bus Low Medium High
Small 50 60 70
Medium 40 80 90
Large 20 50 120
Prior
0.3 0.3 0.4
Probability
If he uses Bayes' decision rule, which size bus will he decide to purchase?
Large
Correct!
Medium
Either small or large
Small
Demand
Bus Low Medium High
Small 50 60 70
Medium 40 80 90
Large 20 50 120
Prior
0.3 0.3 0.4
Probability
What is the expected annual profit for the bus that he will decide to
purchase using Bayes' decision rule?
$ 87,000
Correct!
$72,000
$69,000
$15,000
The construction manager for ABC Construction must decide whether to

build single family homes, apartments, or condominiums. He estimates
annual profits (in $000) will vary with the population trend as follows:
Population Trend
Type Declining Stable Growing
Single Family 200 90 70
Apartments 70 170 90
Condos −20 100 220
Prior Probability 0.4 0.5 0.1
If he uses the maximum likelihood criterion, which kind of dwellings will he

decide to build?
Condos
Correct!
Apartments
Either Apartments or Condos
Single Family
The production planner for Fine Coffees, Inc. produces two coffee blends:
American (A) and British (B). He can only get 300 pounds of Colombian
beans per week and 200 pounds of Dominican beans per week. Each
pound of American blend coffee requires 12 ounces of Colombian beans
and 4 ounces of Dominican beans, while a pound of British blend coffee
uses 8 ounces of each type of bean. Profits for the American blend are
$2.00 per pound, and profits for the British blend are $1.00 per pound.
The goal of Fine Coffees, Inc. is to maximize profits.
What is the objective function?
P = A + 2B
P = 12A + 8B.
P = 8A + 12B.
P = 4A + 8B.
Correct!
P = 2A + B.
What is the constraint for Colombian beans?
4A + 8B ≤ 4,800.
A + 2B ≤ 4,800.
2A + B ≤ 4,800.
8A + 12B ≤ 4,800.
Correct!
12A + 8B ≤ 4,800.
What is the constraint for Dominican beans?
8A + 12B ≤ 4,800.
8A + 4B ≤ 3,200.
Correct! 4A + 8B ≤ 3,200.
4A + 8B ≤ 4,800.
12A + 8B ≤ 4,800.
Which of the following is not a feasible solution?
(A, B) = (0, 0)
Correct! (A, B) = (400, 400)
(A, B) = (0, 400)
(A, B) = (400, 0)
(A, B) = (200, 300)
The operations manager for the Blue Moon Brewing Co. produces two
beers: Lite (L) and Dark (D). He can only get 675 gallons of malt extract
per day for brewing and his brewing hours are limited to 8 hours per day.
To produce a keg of Lite beer requires 2 minutes of time and 5 gallons of
malt extract. Each keg of Dark beer needs 4 minutes of time and 3 gallons
of malt extract. Profits for Lite beer are $3.00 per keg and profits for Dark
beer are $2.00 per keg. The brewery's goal is to maximize profits.
What is the time constraint?
4L + 2D ≤ 480.
5L + 3D ≤ 480.
Correct! 2L + 4D ≤ 480.
3L + 2D ≤ 480.
2L +3D ≤ 480.
An electronics firm produces two models of pocket calculators: the A-100

(A) and the B-200 (B). Each model uses one circuit board, of which there
are only 2,500 available for this week's production. In addition, the
company has allocated a maximum of 800 hours of assembly time this
week for producing these calculators. Each A-100 requires 15 minutes to
produce while each B-200 requires 30 minutes to produce. The firm
forecasts that it could sell a maximum of 4,000 of the A-100s this week
and a maximum of 1,000 B-200s. Profits for the A-100 are $1.00 each and
profits for the B-200 are $4.00 each. The firm's goal is to maximize profits.
What is the time constraint?
1A + 0.5B ≤ 800
Correct! 0.25A + 0.5B ≤ 800
0.25A + 1B ≤ 800
1A + 1B ≤ 800
0.5A + 0.25B ≤ 800
When formulating a linear programming problem on a spreadsheet, the

data cells will show the optimal solution.
Correct! FALSE
TRUE
A feasible solution is one that satisfies all the constraints of a linear

programming problem simultaneously.
Correct! TRUE
FALSE
When formulating a linear programming problem on a spreadsheet, which

of the following is true?
Nonnegativity constraints must be included.
Correct! All of the answer choices are correct.
Decision variables are called changing cells.
Parameters are called data cells.
The objective function is called the objective cell
The production planner for a private label soft drink maker is planning the
production of two soft drinks: root beer (R) and sassafras soda (S). There
are at most 12 hours per day of production time and 1,500 gallons per day
of carbonated water available. A case of root beer requires 2 minutes of
time and 5 gallons of water to produce, while a case of sassafras soda
requires 3 minutes of time and 5 gallons of water. Profits for the root beer
are $6.00 per case, and profits for the sassafras soda are $4.00 per case.
The firm's goal is to maximize profits.
Which of the following is not a feasible solution?
(R, S) = (180, 120)
Correct! (R, S) = (180, 240)
(R, S) = (0, 240)
(R, S) = (300, 0)
A freelance writer must choose how to spend her time working on several
different types of projects.
Newspaper stories take 3 hours to write and pay a flat rate of

$45 per story. Magazine articles take much longer to write (25 hours) but
pay significantly better ($400 per article). Proofreading is often tedious,
but the writer can always find proofreading jobs that pay $20 per hour. The
writer wants to maximize her income, but doesn't want to work more than
45 hours per week. Additionally, she dislikes proofreading so she would
like to spend no more than 7 hours per week on that task. Both
newspaper stories and magazine articles must be completed in the week
they are started (HINT: use an integer constraint to be sure that all
newspaper and magazine jobs are finished within a week).
Which of the following is the objective function for the writer's problem?
Min R = 3N + 25M + P
Max R = 45N + 400M − 20P
Correct! Max R = 45N + 400M + 20P
Max R = 3N + 400M + 20P
Min R = 3N + 25M + 20P
A freelance writer must choose how to spend her time working on several
different types of projects.
Newspaper stories take 3 hours to write and pay a flat rate of

$45 per story. Magazine articles take much longer to write (25 hours) but
pay significantly better ($400 per article). Proofreading is often tedious,

but the writer can always find proofreading jobs that pay $20 per hour. The
writer wants to maximize her income, but doesn't want to work more than
45 hours per week. Additionally, she dislikes proofreading so she would
like to spend no more than 7 hours per week on that task. Both
newspaper stories and magazine articles must be completed in the week
they are started (HINT: use an integer constraint to be sure that all
newspaper and magazine jobs are finished within a week).
Which of the following is the constraint that limits the amount of time the
writer will work each week?
45N + 400M + 20P ≥ 45
3N + 25M + P ≥ 45
3N + 25M + P ≤ 7
Correct! 3N + 25M + P ≤ 45
45N + 400M + 20P ≤ 45
Quiz Score: 42 out of 42

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4/19/23, 11:06 PM Quiz No.

1: [1222_LBOMGTS_K46] - PRESCRIPTIVE ANALYTICS (OPTIMIZATION)

Choose the correct answer.

This quiz was locked Mar 3 at 3:05pm.

LATEST Attempt 1 69 minutes 42 out of 42

Score for this quiz: 42 out of 42

A manager has determined that a potential new product can be sold at a

Correct! 5,000 units.

In order to produce a new product, a firm must lease equipment at a cost

No answer text provided.

No answer text provided.

No answer text provided.

No answer text provided.

1,000 units at $10.00 each.

4,000 units at $5.00 each.

A manager has determined that a potential new product can be sold at a

As part of their course requirement, a group of students bakes pastries

Which of the following is TRUE about the break-even point?

When sales exceed the break-even point, profits will be negative.

Predictive analytics is the process of using data to.

determine the best course of action for the future.

determine the break-even point.

solve linear programming problems.

Prescriptive analytics is the process of using data to

determine the break-even point.

predict what will happen in the future.

A group is planning a conference. The cost to rent the space is $1,000.

States of nature are alternatives available to a decision maker.

No answer text provided.

No answer text provided.

An example of maximax decision making is a person buying lottery tickets

No answer text provided.

No answer text provided.

In decision analysis, states of nature refer to possible future conditions.

No answer text provided.

No answer text provided.

The maximin criterion is an optimistic criterion.

No answer text provided.

No answer text provided.

No answer text provided.

No answer text provided.

Bayes decision rule.

Based on the following payoff table, answer the following:

Alternative High Low

Prior Probability 0.4 0.6

The maximax strategy is:

Based on the following payoff table, answer the following:

Alternative High Low

Prior Probability 0.4 0.6

The maximin strategy is:

None of the given

Based on the following payoff table, answer the following:

Alternative High Low

Prior Probability 0.4 0.6

The Bayes' decision rule strategy is:

Based on the following payoff table, answer the following:

The maximax strategy is:

Based on the following payoff table, answer the following:

The maximin strategy is:

Based on the following payoff table, answer the following:

The Bayes' decision rule strategy is:

Based on the following payoff table, answer the following:

Alternative High Medium Low