Managerial Decision Making Review
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Course Introduction
Managerial Decision Making explores the processes and tools managers use to make effective decisions in complex and dynamic organizational environments. The course examines key theories of decision making, the influence of cognitive biases, risk assessment, and ethical considerations. Through case studies, simulations, and practical exercises, students develop critical thinking and problem-solving skills, learn to analyze data, evaluate alternatives, and implement choices that align with organizational objectives. By understanding both individual and group decision-making dynamics, students are equipped to make strategically sound and responsible decisions in managerial roles.
Recommended Textbook Statistics for Business and Economics 11th Edition by
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Page 2
David R. Anderson
Chapter 1: Data and Statistics
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Sample Questions
Q1) Arithmetic operations are inappropriate for A)categorical data
B)quantitative data
C)both categorical and quantitative data
D)large data sets
Answer: A
Q2) Which of the following can be classified as quantitative data?
A)interval and ordinal
B)ratio and ordinal
C)nominal and ordinal
D)interval and ratio
Answer: D
Q3) The Department of Transportation of a city has noted that on the average there are 17 accidents per day.The average number of accidents is an example of A)descriptive statistics
B)statistical inference
C)a sample
D)a population
Answer: A
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Chapter 2: Descriptive Statistics: Tabular and Graphical Presentations
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Sample Questions
Q1) Refer to Exhibit 2-2.Of those students who are majoring in business,what percentage plans to go to graduate school?
A)27.78
B)8.75
C)70
D)72.22
Answer: A
Q2) Refer to Exhibit 2-3.If one develops a cumulative frequency distribution for the above data,the last class will have a frequency of A)10
B)100
C)0 to 100
D)80
Answer: D
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Chapter 3: Descriptive Statistics: Numerical Measures
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Sample Questions
Q1) In 2009,the average donation to the Community Kitchen was $900 with a standard deviation of $180.In 2010,the average donation was $1,600 with a standard deviation of $240.In which year do the donations show a more dispersed distribution?
Answer: The coefficient of variation in 2009 was 20% (more dispersed).The coefficient of variation in 2010 was 15%.
Q2) Given the following information:
Standard deviation = 8
Coefficient of variation = 64%
The mean would then be
A)12.5
B)8
C)0.64
D)1.25
Answer: A
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Chapter 4: Introduction to Probability
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Sample Questions
Q1) Of the last 100 customers entering a computer shop,25 have purchased a computer.If the classical method for computing probability is used,the probability that the next customer will purchase a computer is
A)0.25
B)0.50
C)1.00
D)0.75
Q2) If A and B are independent events with P(A)= 0.4 and P(B)= 0.6,then P(A \(\cap\) B)=
A)0.76
B)1.00
C)0.24
D)0.20
Q3) How many committees,consisting of 3 female and 5 male students,can be selected from a group of 5 female and 8 male students?
Q4) Assume a businessman has 7 suits and 8 ties.He is planning to take 3 suits and 2 ties with him on his next business trip.How many possibilities of selection does he have?
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Chapter 5: Discrete Probability Distributions
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Sample Questions
Q1) Seven students have applied for merit scholarships.This year 3 merit scholarships were awarded.If a random sample of 3 applications (from the population of 7)is selected,
a.what is the probability that 2 students were recipients of scholarships?
b.what is the probability that no students were the recipients of scholarship?
Q2) Assume that you have a binomial experiment with p = 0.4 and a sample size of 50.The variance of this distribution is A)20
B)12
C)3.46
D)144
Q3) Two percent of the parts produced by a machine are defective.Twenty parts are selected at random.Use the binomial probability tables to answer the following questions.
a.What is the probability that exactly 3 parts will be defective?
b.What is the probability that the number of defective parts will be more than 2 but fewer than 6?
c.What is the probability that fewer than 4 parts will be defective?
d.What is the expected number of defective parts?
e.What is the variance for the number of defective parts?
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Chapter 6: Continuous Probability Distributions
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Sample Questions
Q1) For a standard normal distribution,the probability of obtaining a z value between -1.9 to 1.7 is
A)0.9267
B)0.4267
C)1.4267
D)0.5000
Q2) Refer to Exhibit 6-3.The probability that X will take on a value between 21 and 25 is
A)0.125
B)0.250
C)0.500
D)1.000
Q3) Consider a binomial probability experiment with n = 3 and p = 0.1.Then,the probability of x = 0 is
A)0.0000
B)0.0001
C)0.001
D)0.729
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Chapter 7: Sampling and Sampling Distributions
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Sample Questions
Q1) From a population of 500 elements,a sample of 225 elements is selected.It is known that the variance of the population is 900.The standard error of the mean is approximately
A)1.1022
B)2
C)30
D)1.4847
Q2) Random samples of size 525 are taken from an infinite population whose population proportion is 0.3.The standard deviation of the sample proportions (i.e. ,the standard error of the proportion)is
A)0.0004
B)0.2100
C)0.3000
D)0.0200
Q3) A probability distribution for all possible values of a sample statistic is known as A)a sample statistic
B)a parameter
C)simple random sampling
D)a sampling distribution
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Chapter 8: Interval Estimation
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Sample Questions
Q1) For which of the following values of P is the value of P(1 - P)maximized?
A)P = 0.99
B)P = 0.90
C)P = 0.01
D)P = 0.50
Q2) Refer to Exhibit 8-5.If we want to provide a 95% confidence interval for the SAT scores,the degrees of freedom for reading the critical values of "t" statistic is A)60
B)61
C)62
D)63
Q3) In a random sample of 400 residents of Chattanooga,320 residents indicated that they voted for the Democratic candidate in the last presidential election.Develop a 95% confidence interval estimate for the proportion of all Chattanooga residents who voted for the Democratic candidate.
Q4) A simple random sample of 36 items resulted in a sample mean of 40 and a standard deviation of 12.Construct a 95% confidence interval for the population mean.
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Chapter 9: Hypothesis Tests
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Sample Questions
Q1) Consider the following hypothesis test:
H<sub>o</sub>: p = 0.5
H<sub>a</sub>: p \(\neq\) 0.5
A sample of 800 provided a sample proportion of 0.58.
a.Determine the standard error of the proportion.
b.Compute the value of the test statistic.
c.Determine the p-value,and at 95% confidence,test the hypotheses.
Q2) Refer to Exhibit 9-9.The value of the test statistic is A)250
B)8000
C)8250
D)2.0
Q3) Refer to Exhibit 9-8.The value of the test statistic for this hypothesis test is A)1.96
B)1.645
C)-2.5
D)-1.645
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11
Chapter 10: Statistical Inference About Means and
Proportions With Two Populations
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Sample Questions
Q1) Refer to Exhibit 10-10.At 95% confidence,the margin of error is
A)0.064
B)0.044
C)0.0225
D)52
Q2) Refer to Exhibit 10-1.The point estimate of the difference between the means of the two populations is
A)-28
B)3
C)4
D)-4
Q3) Refer to Exhibit 10-6.At 95% confidence,the margin of error is A)1.694
B)3.32
C)1.96
D)15
Q4) In a sample of 40 Democrats,6 opposed the President's foreign policy,while of 50 Republicans,8 were opposed to his policy.Determine a 90% confidence interval estimate for the difference between the proportions of the opinions of the individuals in the two parties.
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Chapter 11: Inferences About Population Variances
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Sample Questions
Q1) The manager of the service department of a local car dealership has noted that the service times of a sample of 30 new automobiles has a standard deviation of 6 minutes.A 95% confidence interval estimate for the standard deviation of the service times for all their new automobiles is
A)16.047 to 45.722
B)4.778 to 8.066
C)2.93 to 6.31
D)22.833 to 65.059
Q2) The sampling distribution used when making inferences about a single population's variance is
A)an F distribution
B)a t distribution
C)a chi-square distribution
D)a normal distribution
Q3) Refer to Exhibit 11-8.The p-value is
A)less than 0.025
B)less than 0.05
C)less than 0.10
D)greater than 0.10
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Chapter 12: Tests of Goodness of Fit and Independence
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Sample Questions
Q1) An important application of the chi-square distribution is
A)making inferences about a single population variance
B)testing for goodness of fit
C)testing for the independence of two variables
D)All of these alternatives are correct.
Q2) Refer to Exhibit 12-1.The number of degrees of freedom associated with this problem is
A)150
B)149
C)2
D)3
Q3) Refer to Exhibit 12-1.The expected frequency for each group is
A)0.333
B)0.50
C)1/3
D)50
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Chapter 13: Analysis of Variance and Experimental Design
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Sample Questions
Q1) In order to determine whether or not the means of two populations are equal,
A)a t test must be performed
B)an analysis of variance must be performed
C)either a t test or an analysis of variance can be performed
D)a chi-square test must be performed
Q2) Refer to Exhibit 13-1.The test statistic to test the null hypothesis equals
A)0.22
B)0.84
C)4.22
D)4.5
Q3) Refer to Exhibit 13-6.The conclusion of the test is that the means
A)are equal
B)may be equal
C)are not equal
D)None of these alternatives is correct.
Q4) Refer to Exhibit 13-1.The mean square within treatments (MSE)equals
A)400
B)500
C)1,687.5
D)2,250
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Chapter 14: Simple Linear Regression
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Sample Questions
Q1) Refer to Exhibit 14-2.The least squares estimate of b<sub>1</sub> (slope)equals
A)1
B)-1
C)6
D)5
Q2) Refer to Exhibit 14-10.The Y intercept is
A)-1
B)1.0
C)11
D)0.0
Q3) Refer to Exhibit 14-10.The point estimate of Y when X = -3 is A)11
B)14
C)8
D)0
Q4) Refer to Exhibit 14-3.The coefficient of determination equals A)-0.4364
B)0.4364
C)-0.1905
D)0.1905
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Chapter 15: Multiple Regression
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Sample Questions
Q1) Refer to Exhibit 15-1.The computed F statistics for testing the significance of the above model is
A)1.500
B)20.00
C)0.600
D)0.6667
Q2) In order to test for the significance of a regression model involving 8 independent variables and 121 observations,the numerator and denominator degrees of freedom (respectively)for the critical value of F are
A)8 and 121
B)7 and 120
C)8 and 112
D)7 and 112
Q3) Refer to Exhibit 15-6.The sum of squares due to error (SSE)equals
A)37.33
B)485.3
C)4,853
D)6,308.9
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Chapter 16: Regression Analysis: Model Building
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Sample Questions
Q1) Serial correlation is
A)the correlation between serial numbers of products
B)the same as autocorrelation
C)the same as leverage
D)None of these alternatives is correct.
Q2) The correlation in error terms that arises when the error terms at successive points in time are related is termed
A)leverage
B)multicorrelation
C)autocorrelation
D)parallel correlation
Q3) Refer to Exhibit 16-3.We want to test whether the parameter \(\beta\)<sub>2</sub> is significant.The test statistic equals
A)4
B)5
C)3
D)-3
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Chapter 17: Index Numbers
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Sample Questions
Q1) The reason why weights are used in an aggregate index is to
A)insure that all items have an influence on the index which is relative to their respective importance
B)insure that expensive items are considered more heavily
C)insure that current prices will influence the index more than base prices
D)None of these alternatives is correct.
Q2) Refer to Exhibit 17-2.The weighted aggregate price index for 2010 is
A)163.768
B)1.637
C)63.768
D)2.2
Q3) The Laspeyres index is a weighted aggregate price index where the weight for each item is its
A)current-period quantity
B)base-period price
C)current-period price
D)base-period quantity
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19
Chapter 18: Forecasting
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Sample Questions
Q1) Refer to Exhibit 18-2.The slope of linear trend equation,b<sub>1</sub>,is
A)2.5
B)2.0
C)1.0
D)1.25
Q2) Which of the following is not present in a time series?
A)seasonality
B)operational variations
C)trend
D)cycles
Q3) One measure of the accuracy of a forecasting model is
A)the smoothing constant
B)a deseasonalized time series
C)the mean square error
D)None of these alternatives is correct.
Q4) A group of observations measured at successive time intervals is known as A)a trend component
B)a time series
C)a forecast
D)an additive time series model
Page 20
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Chapter 19: Nonparametric Methods
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Sample Questions
Q1) In a questionnaire,respondents are asked to mark their marital status.Marital status is an example of the
A)ordinal scale
B)nominal scale
C)ratio scale
D)interval scale
Q2) The level of measurement that is simply a label for the purpose of identifying an item is
A)ordinal measurement
B)ratio measurement
C)nominal measurement
D)internal measurement
Q3) A collection of statistical methods that generally requires very few,if any,assumptions about the population distribution is known as
A)parametric methods
B)nonparametric methods
C)distribution-fixed methods
D)normal
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Chapter 20: Statistical Methods for Quality Control
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Sample Questions
Q1) Variations in process output that are due to factors such as machine tools wearing out are
A)common causes
B)assignable causes
C)control causes
D)None of these alternatives is correct.
Q2) The upper and lower control limits of the proportions of defectives of a process are 0.33 and 0.27.
a.What has been the proportion of defectives in this process?
b.What has been the sample size?
Q3) If the lower-control limit of a P chart is negative,
A)a mistake has been made in the computations
B)use the absolute value of the lower limit
C)it is set to zero
D)None of these alternatives is correct.
Q4) A production process is considered in control if no more than to 6% of the items produced are defective.Samples of size 300 are used for the inspection process.
a.Determine the standard error of the proportion.
b.Determine the upper and the lower control limits for the P chart.
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Chapter 21: Decision Analysis
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Sample Questions
Q1) A line or arc connecting the nodes of a decision tree is called a(n)
A)junction
B)intersection
C)branch
D)node
Q2) The probability of both sample information and a particular state of nature occurring simultaneously is
A)unconditional probability
B)joint probability
C)marginal probability
D)conditional probability
Q3) Nodes indicating points where an uncertain event will occur are known as
A)decision nodes
B)chance nodes
C)marginal nodes
D)conditional nodes
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Chapter 22: Sample Survey
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Sample Questions
Q1) Refer to Exhibit 22-4.An approximate 95% confidence interval for the population proportion is
A)0.500 to 0.700
B)0.750 to 0.810
C)0.576 to 0.824
D)0.638 to 0.762
Q2) Refer to Exhibit 22-3.An approximate 95% confidence interval for the population mean is
A)395 to 405
B)380 to 420
C)360 to 440
D)390 to 410
Q3) A sampling unit
A)must have one element
B)may include several elements
C)can not include more than one element
D)None of these alternatives is correct.
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