Question 1

What is the expected value for the optimum decision alternative?

Accepted Answer

A) $15,000,000 
B) $9,060,000 
C) $8,400,000 
D) $7,200,000 
E) $6,000,000 
A) $15,000,000 
B) $9,060,000 
C) $8,400,000 
D) $7,200,000 
E) $6,000,000 B

Question 2

Which one of these is not used in decision-making under risk?

Accepted Answer

A) EVPI 
B) EMV 
C) decision trees 
D) minimax regret 
E) All are used for risk situations. 
A) EVPI 
B) EMV 
C) decision trees 
D) minimax regret 
E) All are used for risk situations. D

Question 3

If she feels that there is a 60% chance that the new cable network will be successful, what is her expected value (per thousand "hits") of perfect information?

Accepted Answer

A) $3.40 
B) $4.60 
C) $8.00 
D) $9.00 
E) $10.00 
A) $3.40 
B) $4.60 
C) $8.00 
D) $9.00 
E) $10.00 A

Question 4

For what range of probability that the new cable network will be successful will she select the print media strategy?

Accepted Answer

A) 0 - .4 
B) 0 - .55 
C) .4 - .7 
D) .55 - 1 
E) .7 - 1 
A) 0 - .4 
B) 0 - .55 
C) .4 - .7 
D) .55 - 1 
E) .7 - 1

Question 5

What is the expected value of selecting script #1?

Accepted Answer

A) $15,000,000 
B) $9,060,000 
C) $8,400,000 
D) $7,200,000 
E) $6,000,000 
A) $15,000,000 
B) $9,060,000 
C) $8,400,000 
D) $7,200,000 
E) $6,000,000

Question 6

For what range of probability that the new cable network will be successful will she select the television media strategy?

Accepted Answer

A) 0 - .4 
B) 0 - .55 
C) .4 - .7 
D) .55 - 1 
E) .7 - 1 
A) 0 - .4 
B) 0 - .55 
C) .4 - .7 
D) .55 - 1 
E) .7 - 1

Question 7

What would be the total payoff if the heart lab were funded in both the first and second years?

Accepted Answer

A) $100,000 
B) $60,000 
C) $50,000 
D) $40,000 
E) $20,000 
A) $100,000 
B) $60,000 
C) $50,000 
D) $40,000 
E) $20,000

Question 8

Testing how a problem solution reacts to changes in one or more of the model parameters is called:

Accepted Answer

A) simulation 
B) sensitivity analysis 
C) priority recognition 
D) analysis of variance 
E) decision analysis 
A) simulation 
B) sensitivity analysis 
C) priority recognition 
D) analysis of variance 
E) decision analysis

Question 9

If she feels the chances of low, medium, and high demand are 50%, 20%, and 30% respectively, what is her expected value of perfect information?

Accepted Answer

A) $54,000 
B) $55,000 
C) $70,000 
D) $80,000 
E) $135,000 
A) $54,000 
B) $55,000 
C) $70,000 
D) $80,000 
E) $135,000

Question 10

If he uses the minimax regret criterion, which kind of dwellings will he decide to build?

Accepted Answer

A) single family 
B) apartments 
C) condos 
D) either single family or apartments 
E) either apartments or condos 
A) single family 
B) apartments 
C) condos 
D) either single family or apartments 
E) either apartments or condos

Question 11

If he uses the minimax regret criterion, which alternative will he decide to select?

Accepted Answer

A) do nothing 
B) expand 
C) build new 
D) either do nothing or expand 
E) either expand or build new 
A) do nothing 
B) expand 
C) build new 
D) either do nothing or expand 
E) either expand or build new

Question 12

If she uses the minimax regret criterion, what size outlet will she decide to lease?

Accepted Answer

A) small 
B) Medium 
C) large 
D) either small or Medium 
E) either medium or large 
A) small 
B) Medium 
C) large 
D) either small or Medium 
E) either medium or large

Question 13

If he uses the maximin criterion, which size bus will he decide to purchase?

Accepted Answer

A) small 
B) Medium 
C) large 
D) either small or Medium 
E) either medium or large 
A) small 
B) Medium 
C) large 
D) either small or Medium 
E) either medium or large

Question 14

The maximin approach involves choosing the alternative that has the "best worst" payoff.

Accepted Answer

A) True 
 B)False

Question 15

-If you feel that P(#1) = .4, P(#2) = .3, P(#3) = .2, and P(#4) = .1, what is your expected payoff under certainty?

Accepted Answer

The answer of  
-If you feel that P(#1) =...

Question 16

Which of the following is not a stage in the decision making process?

Accepted Answer

A) select the best alternative 
B) develop suitable alternatives 
C) analyze and compare alternatives 
D) monitor the competition 
E) specify objectives 
A) select the best alternative 
B) develop suitable alternatives 
C) analyze and compare alternatives 
D) monitor the competition 
E) specify objectives

Question 17

The maximax strategy would be:

Accepted Answer

A) buy 
B) lease 
C) rent 
D) high 
E) low 
A) buy 
B) lease 
C) rent 
D) high 
E) low

Question 18

If she uses the minimax regret criterion, which advertising strategy will she use?

Accepted Answer

A) print 
B) mixed 
C) television 
D) either print or mixed 
E) either mixed or television 
A) print 
B) mixed 
C) television 
D) either print or mixed 
E) either mixed or television

Question 19

If yes and no are equally likely, which alternative has the largest expected monetary value?

Accepted Answer

A) small 
B) Medium 
C) med.-large 
D) large 
E) ex-large 
A) small 
B) Medium 
C) med.-large 
D) large 
E) ex-large

Question 20

Among decision environments, risk implies that certain parameters have probabilistic outcomes.

Accepted Answer

A) True 
 B)False

Exam 21: Extension 5: Decision Theory

What is the expected value for the optimum decision alternative?

Which one of these is not used in decision-making under risk?

If she feels that there is a 60% chance that the new cable network will be successful, what is her expected value (per thousand "hits") of perfect information?

For what range of probability that the new cable network will be successful will she select the print media strategy?

What is the expected value of selecting script #1?

For what range of probability that the new cable network will be successful will she select the television media strategy?

What would be the total payoff if the heart lab were funded in both the first and second years?

Testing how a problem solution reacts to changes in one or more of the model parameters is called:

If she feels the chances of low, medium, and high demand are 50%, 20%, and 30% respectively, what is her expected value of perfect information?

If he uses the minimax regret criterion, which kind of dwellings will he decide to build?

If he uses the minimax regret criterion, which alternative will he decide to select?

If she uses the minimax regret criterion, what size outlet will she decide to lease?

If he uses the maximin criterion, which size bus will he decide to purchase?

The maximin approach involves choosing the alternative that has the "best worst" payoff.

-If you feel that P(#1) = .4, P(#2) = .3, P(#3) = .2, and P(#4) = .1, what is your expected payoff under certainty?

Which of the following is not a stage in the decision making process?

The maximax strategy would be:

If she uses the minimax regret criterion, which advertising strategy will she use?

If yes and no are equally likely, which alternative has the largest expected monetary value?

Among decision environments, risk implies that certain parameters have probabilistic outcomes.

Introduction to Operations Management

Competitiveness, Strategy, and Productivity

Forecasting

Product and Service Design

Strategic Capacity Planning for Products and Services

Process Selection and Facility Layout

Work Design and Measurement

Location Planning and Analysis

Management of Quality

Quality Control

Aggregate Planning and Master Scheduling

MRP and ERP

Inventory Management

Jit and Lean Operations

Supply Chain Management

Scheduling

Project Management

Management of Waiting Lines

Linear Programming

Extension 4: Reliability

Extension 7: Learning Curves

Extension 8: The Transportation Model

Extension 10: Acceptance Sampling

Extension 14: Maintenance

Filters