Business Analytics Test Bank
Course Introduction
Business Analytics is a comprehensive course that introduces students to the theories, methods, and tools used to analyze data and extract meaningful insights to inform business decision-making. Through a combination of statistical techniques, data visualization, predictive modeling, and case studies, students will learn how to approach real-world business problems with data-driven solutions. The course emphasizes the practical application of analytics in areas such as marketing, operations, finance, and strategy, enabling students to build foundational skills essential for todays data-centric business environment.
Recommended Textbook
Quantitative Methods for Business 11th Edition by David R. Anderson
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17 Chapters
845 Verified Questions
845 Flashcards
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Page 2
Chapter 1: Introduction
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Sample Questions
Q1) A snack food manufacturer buys corn for tortilla chips from two cooperatives,one in Iowa and one in Illinois.The price per unit of the Iowa corn is $6.00 and the price per unit of the Illinois corn is $5.50.
a.Define variables that would tell how many units to purchase from each source.
b.Develop an objective function that would minimize the total cost.
c.The manufacturer needs at least 12000 units of corn.The Iowa cooperative can supply up to 8000 units,and the Illinois cooperative can supply at least 6000 units.Develop constraints for these conditions.
Answer: a.Let x<sub>1</sub> = the number of units from Iowa
Let x<sub>2</sub> = the number of units from Illinois
b.Min 6x<sub>1</sub> + 5.5x<sub>2</sub>
c.x<sub>1</sub> + x<sub>2 </sub>> 12000
x<sub>1</sub> > 8000
x<sub>1</sub> > 6000
Q2) The first step in the decision making process is to identify the problem.
A)True
B)False
Answer: True
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Page 3
Chapter 2: Introduction to Probability
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Sample Questions
Q1) A food distributor carries 64 varieties of salad dressing.Appleton Markets stocks 48 of these flavors.Beacon Stores carries 32 of them.The probability that a flavor will be carried by Appleton or Beacon is 15/16.Use a Venn diagram to find the probability a flavor is carried by both Appleton and Beacon.
Answer: The Venn diagram is 11ea83ec_7737_fe17_bb88_c3f66fdf960e_TB2191_00 and P(A\(\cap\) B)= P(A)+ P(B)- P(A\(\cup\) B)= 6/8 + 4/8 - 15/16 = 5/16 = .3125
Q2) If P(A|B)= .2 and P(B<sup>c</sup>)= .6,then P(B|A)
A)is .8
B)is .12
C)is .33
D)cannot be determined.
Answer: D
Q3) A posterior probability is a conditional probability.
A)True
B)False
Answer: True
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Page 4
Chapter 3: Probability Distributions
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Sample Questions
Q1) The binomial distribution is appropriate to use to find the probability of the elapsed time between successes.
A)True
B)False
Answer: False
Q2) A process follows the binomial distribution with n = 8 and p = .3.Find
a.P(x = 3)
b.P(x > 6)
c.P(x \(\le\) 2)
Answer: a.2541
b.0013
c.5518
Q3) Probabilities for discrete random variables are defined over intervals by a probability density function.
A)True
B)False
Answer: False
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Page 5
Chapter 4: Decision Analysis
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Sample Questions
Q1) Transrail is bidding on a project that it figures will cost $400,000 to perform.Using a 25% markup,it will charge $500,000,netting a profit of $100,000.However,it has been learned that another company,Rail Freight,is also considering bidding on the project.If Rail Freight does submit a bid,it figures to be a bid of about $470,000.Transrail really wants this project and is considering a bid with only a 15% markup to $460,000 to ensure winning regardless of whether or not Rail Freight submits a bid.
a.Prepare a profit payoff table from Transrail's point of view.
b.What decision would be made if Transrail were conservative?
c.If Rail Freight is known to submit bids on only 25% of the projects it considers,what decision should Transrail make?
d.Given the information in (c),how much would a corporate spy be worth to Transrail to find out if Rail Freight will bid?
Q2) Which of the methods for decision making without probabilities best protects the decision maker from undesirable results?
A)the optimistic approach
B)the conservative approach
C)minimum regret
D)minimax regret
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Chapter 5: Utility and Game Theory
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Sample Questions
Q1) When consequences are measured on a scale that reflects a decision maker's attitude toward profit,loss,and risk,payoffs are replaced by A)utility values.
B)multicriteria measures.
C)sample information.
D)opportunity loss.
Q2) The outcome with the highest payoff will also have the highest utility. A)True B)False
Q3) A game has a saddle point when pure strategies are optimal for both players. A)True B)False
Q4) When monetary value is not the sole measure of the true worth of the outcome to the decision maker,monetary value should be replaced by utility. A)True B)False
Q5) The expected utility is the utility of the expected monetary value. A)True B)False
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Chapter 6: Forecasting
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Sample Questions
Q1) All quarterly time series contain seasonality.
A)True
B)False
Q2) The exponential smoothing forecast for any period is a weighted average of all the previous actual values for the time series.
A)True
B)False
Q3) Which of the following is a qualitative forecasting method?
A)trend projection
B)time series method
C)smoothing method
D)Delphi method
Q4) To select a value for \(\alpha\) for exponential smoothing
A)use a small \(\alpha\) when the series varies substantially.
B)use a large \(\alpha\) when the series has little random variability.
C)use any value between 0 and 1
D)All of the alternatives are true.
Q5) Trend in a time series must be linear.
A)True
B)False
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Chapter 7: Introduction to Linear Programming
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Sample Questions
Q1) A redundant constraint is a binding constraint.
A)True
B)False
Q2) Because surplus variables represent the amount by which the solution exceeds a minimum target,they are given positive coefficients in the objective function. A)True
B)False
Q3) Find the complete optimal solution to this linear programming problem. Min 5X + 6Y<sub> </sub>
s.t.3X + Y > 15
X + 2Y > 12
3X + 2Y > 24
X<sub> </sub>,Y > 0
Q4) Solve the following system of simultaneous equations.
6X + 4Y = 40
2X + 3Y = 20
Q5) In a feasible problem,an equal-to constraint cannot be nonbinding. A)True B)False
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Chapter 8: Lp Sensitivity Analysis and Interpretation of Solution
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Sample Questions
Q1) The dual price measures,per unit increase in the right hand side, A)the increase in the value of the optimal solution.
B)the decrease in the value of the optimal solution.
C)the improvement in the value of the optimal solution. D)the change in the value of the optimal solution.
Q2) The dual price associated with a constraint is the improvement in the value of the solution per unit decrease in the right-hand side of the constraint.
A)True B)False
Q3) The reduced cost for a positive decision variable is 0. A)True B)False
Q4) If the dual price for the right-hand side of a < constraint is zero,there is no upper limit on its range of feasibility.
A)True
B)False
Q5) Decision variables must be clearly defined before constraints can be written. A)True B)False
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Chapter 9: Linear Programming Applications
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Sample Questions
Q1) If a real-world problem is correctly formulated,it is not possible to have alternative optimal solutions.
A)True
B)False
Q2) If P<sub>ij</sub> = the production of product i in period j,then to indicate that the limit on production of the company's three products in period 2 is 400,
A)P<sub>21</sub> + P<sub>22</sub> + P<sub>23</sub> < 400
B)P<sub>12</sub> + P<sub>22</sub> + P<sub>32</sub> < 400
C)P<sub>32</sub> < 400
D)P<sub>23</sub> < 400
Q3) Let A,B,and C be the amounts invested in companies A,B,and C.If no more than 50% of the total investment can be in company B,then
A)B < 5
B)A - .5B + C < 0
C).5A - B - .5C < 0
D)-.5A + .5B - .5C < 0
Q4) Portfolio selection problems should acknowledge both risk and return.
A)True
B)False
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Chapter 10: Distribution and Network Problems
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Sample Questions
Q1) If a transportation problem has four origins and five destinations,the LP formulation of the problem will have
A)5 constraints
B)9 constraints
C)18 constraints
D)20 constraints
Q2) A transportation problem with 3 sources and 4 destinations will have 7 variables in the objective function.
A)True
B)False
Q3) If a transportation problem has four origins and five destinations,the LP formulation of the problem will have nine constraints.
A)True
B)False
Q4) When the number of agents exceeds the number of tasks in an assignment problem,one or more dummy tasks must be introduced in the LP formulation or else the LP will not have a feasible solution.
A)True
B)False
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Chapter 11: Integer Linear Programming
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Sample Questions
Q1) Rounding the solution of an LP Relaxation to the nearest integer values provides
A)a feasible but not necessarily optimal integer solution.
B)an integer solution that is optimal.
C)an integer solution that might be neither feasible nor optimal.
D)an infeasible solution.
Q2) The solution to the LP Relaxation of a minimization problem will always be less than or equal to the value of the integer program minimization problem.
A)True
B)False
Q3) Which of the following is the most useful contribution of integer programming?
A)finding whole number solutions where fractional solutions would not be appropriate
B)using 0-1 variables for modeling flexibility
C)increased ease of solution
D)provision for solution procedures for transportation and assignment problems
Q4) Rounded solutions to linear programs must be evaluated for A)feasibility and optimality.
B)sensitivity and duality.
C)relaxation and boundedness.
D)each of the above is true.
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Chapter 12: Advanced Optimization Application
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Sample Questions
Q1) A feasible solution is a global optimum if there are no other feasible points with a better objective function value in the feasible region.
A)True
B)False
Q2) If the coefficient of each squared term in a quadratic function is positive,the function is
A)concave.
B)convex.
C)elliptical.
D)sinusoidal.
Q3) A function is quadratic if its nonlinear terms have a power of 4.
A)True
B)False
Q4) There are nonlinear applications in which there is a single local optimal solution that is also the global optimal solution.
A)True
B)False
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Chapter 13: Project Scheduling: Pertcpm
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Sample Questions
Q1) The project manager should monitor the progress of any activity with a large time variance even if the expected time does not identify the activity as a critical activity.
A)True
B)False
Q2) When activity times are uncertain,an activity's most likely time is the same as its expected time.
A)True
B)False
Q3) Which of the following is always true about a critical activity?
A)LS = EF.
B)LF = LS.
C)ES = LS.
D)EF = ES.
Q4) Which of the following is a general rule for crashing activities?
A)Crash only non-critical activities.
B)Crash activities with zero slack.
C)Crash activities with the greatest number of predecessors.
D)Crash the path with the fewest activities.
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Chapter 14: Inventory Models
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Sample Questions
Q1) In the periodic review model,the order quantity at each review period must be sufficient to cover demand for the review period plus the demand for the following lead time.
A)True
B)False
Q2) In the single-period inventory model with probabilistic demand,
A)surplus items are not allowed to be carried in future inventory.
B)c<sub>o</sub> = c?<sub>u</sub> .
C)probabilities are used to calculate expected losses.
D)All of the alternatives are correct.
Q3) When demand is independent,it is not related to demand for other components or items produced by the firm.
A)True
B)False
Q4) The terms "inventory on hand" and "inventory position" have the same meaning. A)True
B)False
Q5) Constant demand is a key assumption of the EOQ model.
A)True
B)False
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Chapter 15: Waiting Line Models
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Sample Questions
Q1) The assumption of exponentially distributed service times indicates that
A)37% of the service times are less than the mean service time.
B)50% of the service times are less than the mean service time.
C)63% of the service times are less than the mean service time.
D)service time increase at an exponential rate as the waiting line grows.
Q2) The arrival rate in queuing formulas is expressed as
A)the mean time between arrivals.
B)the minimum number of arrivals per time period.
C)the mean number of arrivals per channel.
D)the mean number of arrivals per time period.
Q3) If some maximum number of customers is allowed in a queuing system at one time,the system has a finite calling population.
A)True
B)False
Q4) For an M/G/1 system with \(\lambda\) = 6 and \(\mu\) = 9,with \(\sigma\) = .03,find
a.the probability the system is idle.
b.the average length of the queue.
c.the average number in the system.
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Chapter 16: Simulation
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Sample Questions
Q1) Validation determines that the computer procedure is operating as it is intended to operate.
A)True
B)False
Q2) A static simulation model is used in situations where the state of the system affects how the system changes or evolves over time.
A)True
B)False
Q3) Numerical values that appear in the mathematical relationships of a model and are considered known and remain constant over all trials of a simulation are A)parameters.
B)probabilistic input.
C)controllable input.
D)events.
Q4) A quantity that is difficult to measure with certainty is called a A)risk analysis.
B)project determinant.
C)probabilistic input.
D)profit/loss process.
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Chapter 17: Markov Processes
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Sample Questions
Q1) The probability of reaching an absorbing state is given by the A)R matrix.
B)NR matrix.
C)Q matrix.
D)(I - Q)<sup>-1</sup> matrix
Q2) If an absorbing state exists,then the probability that a unit will ultimately move into the absorbing state is given by the steady state probability.
A)True
B)False
Q3) If the probability of making a transition from a state is 0,then that state is called a(n) A)steady state.
B)final state.
C)origin state.
D)absorbing state.
Q4) The sum of the probabilities in a transition matrix equals the number of rows in the matrix.
A)True
B)False
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