Spreadsheet Modeling for Business Study Guide Questions - 1113 Verified Questions

Spreadsheet Modeling for Business Study Guide Questions

Course Introduction

Spreadsheet Modeling for Business introduces students to the practical application of spreadsheet software, such as Microsoft Excel, for solving real-world business problems. The course covers fundamental and advanced spreadsheet functions, data analysis, and visualization techniques. Students learn to build, interpret, and optimize financial models, perform sensitivity and scenario analyses, and use tools such as pivot tables and lookup functions. Emphasis is placed on developing logical thinking, attention to detail, and presentation skills, equipping students to make informed, data-driven decisions in various business contexts.

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Managerial Decision Modeling 6th International Edition by Cliff T. Ragsdale

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2

Chapter 1: Introduction to Modeling and Decision Analysis

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Sample Questions

Q1) Solutions to which of the following categories of modeling techniques indicate a course of action to the decision maker?

A)Descriptive models

B)Predictive models

C)Prescriptive models

D)Preventive models

Answer: C

Q2) Chapter One discussed all of the following except:

A)how models of decision problems differ in a number of important characteristics.

B)how spreadsheet modeling and analysis fit into the problem-solving process.

C)how spreadsheet models of decision problems can be used to analyze the consequences of possible courses of action.

D)how to implement a problem formulation as a spreadsheet model.

Answer: D

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Chapter 2: Introduction to Optimization and Linear Programming

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Sample Questions

Q1) Which of the following is the general format of an objective function?

A)f(X₁, X₂, ..., X_n) \(\le\)b

B)f(X₁, X₂, ..., X_n) \(\ge\) b

C)f(X₁, X₂, ..., X_n) = b

D)f(X₁, X₂, ..., X_n)

Answer: D

Q2) A production optimization problem has 4 decision variables and a requirement that at least b₁ units of material 1 are consumed. Which of the following constraints reflects this fact?

A)f(X₁, X₂, X₃, X₄) \(\ge\) b₁

B)f(X₁, X₂, X₃, X₄) \(\le\) b₁

C)f(X₁, X₂, X₃, X₄) = b₁

D)f(X₁, X₂, X₃, X₄) \(\neq\) b₁

Answer: B

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Page 4

Chapter 3: Modeling and Solving Lp Problems in a Spreadsheet

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Sample Questions

Q1) The built-in Solver in Excel is found under which tab on the ribbon?

A)Tools

B)Insert

C)Data

D)Window

Answer: C

Q2) Problems which have only integer solutions are called

A)discrete programming problems

B)integer programming problems

C)discrete programming problems.

D)infeasible programming problems

Answer: B

Q3) Refer to Exhibit 3.2. Which cells should be changing cells in this problem?

A)B4:C4

B)E5

C)D8:D10

D)E8:E10

Answer: A

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Chapter 4: Sensitivity Analysis and the Simplex Method

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Sample Questions

Q1) A binding less than or equal to (\(\le\)) constraint in a maximization problem means

A)that all of the resource represented by the constraint is consumed in the solution.

B)it is not a constraint that the level curve contacts.

C)another constraint is limiting the solution.

D)the requirement for the constraint has been exceeded.

Q2) Meaningful Risk Solver Platform (RSP) sensitivity report headings can be defined

A)by adding cell notes to spreadsheet cells.

B)by using the Guess button in the Risk Solver Platform (RSP) dialog box.

C)by carefully labeling rows and columns in the spreadsheet model.

D)naming cells in the spreadsheet model.

Q3) A change in the right hand side of a binding constraint may change all of the following except

A)optimal value of the decision variables

B)slack values

C)other right hand sides

D)objective function value

Q4) Refer to Exhibit 4.1. The Week 1 by Truck and Week 1 by Rail constraints each have a shadow price of -360. What do these values imply?

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Chapter 5: Network Modeling

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Sample Questions

Q1) A network flow problem that allows gains or losses along the arcs is called a

A)non-constant network flow model.

B)non-directional, shortest path model.

C)generalized network flow model.

D)transshipment model with linear side constraints.

Q2) A node which can both send to and receive from other nodes is a

A)demand node.

B)supply node.

C)random node.

D)transshipment node.

Q3) What is the interpretation of units "shipped" along arcs from dummy supply nodes to demand nodes?

A)Indicates unmet demand at demand nodes

B)Indicates unmet supply at demand nodes

C)Indicates unmet demand at supply nodes

D)Indicates unmet supply at supply nodes

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Chapter 6: Integer Linear Programming

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Sample Questions

Q1) A company has four projects, numbered 1 through 4. If any project is selected for implementation, each lower-numbered project must also be selected for implementation. Formulate the constraints to enforce these conditions.

Q2) An integrality condition indicates that some (or all) of the

A)RHS values for constraints must be integer

B)objective function coefficients must be integer

C)constraint coefficients must be integer

D)decision variables must be integer

Q3) A manufacturing company has costs associated with production preparation and with per unit production. The per unit production costs are referred to as

A)decision variables.

B)production cost constraint coefficients.

C)variable costs.

D)marginal costs.

Q4) How are binary variables specified in the Risk Solver Platform (RSP)?

A)By replacing RHS values in constraints with 0 or 1.

B)By specifying changing cells as INTEGER and as non-negative.

C)By specifying changing cells as BINARY in the Variable Type/Bound area of RSP.

D)By selecting Assume Binary Model in the RSP Options dialog box.

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Chapter 7: Goal Programming and Multiple Objective

Optimization

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Sample Questions

Q1) Refer to Exhibit 7.3. Which value should the investor change, and in what direction, if he wants to reduce the risk of the portfolio?

A)D11, increase

B)D12, increase

C)C12, increase

D)D12, decrease

Q2) A constraint which cannot be violated is called a

A)binding constraint.

B)hard constraint.

C)definite constraint.

D)required constraint.

Q3) Which of the following is false regarding a goal constraint?

A)A goal constraint allows us to determine how close a given solution comes to achieving a goal.

B)A goal constraint will always contain two deviational variables.

C)Deviation variables are non-negative.

D)If two deviation variables are used in a constraint at least one will have a value of zero.

Q4) Refer to Exhibit 7.4. What formulas should go in cell E26 of the spreadsheet?

Page 9

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Chapter 8: Nonlinear Programming and Evolutionary Optimization

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Sample Questions

Q1) The optimal trade-off between risk and return for a given portfolio problem can be summarized by the

A)efficient frontier.

B)investment frontier.

C)portfolio boundary.

D)variance boundary.

Q2) Refer to Exhibit 8.2. What formula would you place in cell D13 to calculate total cost?

Q3) A construction company just purchased a 300 * 300 foot lot upon which they plan to build an office building. They need at least 60,000 ft² of office floor space. Zoning regulations require each floor be 10 feet high and the building not exceed 65 ft in height. Further, parking space must equal at least 30% of the total floor space available. The company's cost accountant uses a 60% factor of the building height and a 1% factor of any story's floor area to calculate the total building cost (in millions of dollars). Formulate the NLP for the problem.

Q4) Refer to Exhibit 8.2. What formula would you place in cell B6 to calculate Total Lot Area?

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Page 10

Chapter 9: Regression Analysis

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Sample Questions

Q1) The R² statistic

A)varies between -1 and 1.

B)compares the regression sum of squares to the total sum of squares.

C)accounts for the number of parameters in the regression model.

D)is the ratio of the error sum of squares to the regression sum of squares.

Q2) Refer to Exhibit 9.7. What is the SS for Residual and MS for Residual?

Q3) Regression analysis is a modeling technique

A)that assumes all data is normally distributed.

B)for analyzing the relationship between dependent and independent variables.

C)for examining linear trend data only.

D)for capturing uncertainty in predicted values of Y.

Q4) The method of least squares finds parameter values that

A)minimizes TSS.

B)minimizes RSS.

C)minimizes ESS.

D)minimizes ESS + RSS.

Q5) Refer to Exhibit 9.1. What is the estimated regression function for this problem? Explain what the terms in your equation mean.

Q6) Refer to Exhibit 9.6. What is the MS for Residual?

Q7) Refer to Exhibit 9.6. What is the F-statistic value?

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Chapter 10: Discriminant Analysis

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Sample Questions

Q1) Refer to Exhibit 10.2. Based on the analysis presented in the spreadsheet, what percentage of the observations were correctly classified?

A)80%

B)85%

C)95%

D)100%

Q2) Multiple discriminant analysis moves away from a regression approach to using a measure of distance. Which of the following characterizes the use of a distance function?

A)Each data value's distance from the origin will align with the appropriate group regression line.

B)A data value will fall nearest to the centroid point of its group.

C)The distance measure accounts for the variance of the group data as well as the group centroid.

D)Neither (b) nor (c) characterize the distance measure.

Q3) Refer to Exhibit 10.6. Compute the discriminant score and predicted group for a company with Liquidity = 0.80, Profitability = 0.27 and Activity = 1.55.

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Chapter 11: Time Series Forecasting

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Sample Questions

Q1) Refer to Exhibit 11.8. What are predicted sales for the first quarter of year 4?

A)795 \(\le\) predicted sales < 800

B)860 \(\le\) predicted sales < 865

C)910 \(\le\) predicted sales < 915

D)1280 \(\le\) predicted sales < 1285

Q2) Why might a forecaster calculate MSE values on just the most recent data in the time-series data set?

A)The forecaster might be interested in how well the forecasting method performs on the more recent data.

B)Because the most recent data may be a better predictor of future values.

C)Because the resulting forecasting function might fit the older data better that the more recent data.

D)All of these.

Q3) Refer to Exhibit 11.9. What are predicted sales for the fourth quarter of year 4?

A)1020 \(\le\) predicted sales < 1025

B)1090 \(\le\) predicted sales < 1095

C)1160 \(\le\) predicted sales < 1165

D)1230 \(\le\) predicted sales < 1235

Q4) Refer to Exhibit 11.18. What is the forecast for time period 13?

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Chapter 12: Introduction to Simulation Using Risk Solver

Platform

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Sample Questions

Q1) Using the information in Exhibit 12.3, what formula should go in cell C9 and copied to C10:C21 of the MODEL sheet to compute units received?

A)=COUNT($J$8:J8,A9)*$D$4

B)=COUNTIF($J$8:J8,A8)*$C$4

C)=COUNTIF($J$8:J8,A9)*$D$5

D)=COUNTIF($J$8:J8,A9)*$D$4

Q2) Using the information in Exhibit 12.2, what formula should go in cell B12 of the Confidence Intervals spreadsheet to compute the upper limit on a 95% confidence interval for the population proportion below 90%?

A)=B10+1.96*B10*(1-B10)/SQRT(B2)

B)=B10+1.96*SQRT(B10*(1-B10)/B2)

C)=B10+1.96*SQRT(B10*(1-B10)*B2)

D)=B10+1.96*B10*(1-B10)/B2

Q3) Using the information in Exhibit 12.3, what formula should go in cell H8 to determine if an order should be placed?

A)=IF(G8<$D$3,1,0)

B)=IF(G8>$D$3,1,0)

C)=IF(G8<$D$3,0,1)

D)=IF(G8<$D$4,1,0)

Page 14

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Chapter 13: Queuing Theory

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Sample Questions

Q1) Refer to Exhibit 13.4. Based on this report what is the average number of customers waiting for a checker?

Q2) The standardized queuing system notation such as M/M/1 or M/G/2 is referred to as

A)Kendall notation.

B)Erlang notation.

C)Poisson notation.

D)Queuing notation.

Q3) Joe's Copy Center has 10 copiers. They break down at a rate of 0.02 copiers per hour and are sent to the service facility. What is the average arrival rate of broken copiers to the service facility?

A)0.02

B)0.2

C)10

D)It cannot be determined from the information provided.

Q4) Refer to Exhibit 13.5. Based on this report what is the average number of jobs waiting to be printed?

Q5) Refer to Exhibit 13.3. What is the average time a customer spends in the service line?

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Page 15

Chapter 14: Decision Analysis

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Q1) Refer to Exhibit 14.9. Assume the formula =MAX(B5:C5) was entered in cell D5 and copied to cells D6:D8. What formula should go in cell E5 and get copied to cells E6:E8 to place a "<==" to indicate the choice according to the maximax decision rule?

Q2) Refer to Exhibit 14.3. What decision should be made according to the expected regret decision rule?

A)A

B)B

C)C

D)Bank

Q3) A payoff matrix depicts ____ versus ____ with payoffs for each intersection cell. A)decision criteria; states of nature.

B)decision alternatives; potential outcomes.

C)decision alternatives; states of nature.

D)decision criteria; potential outcomes.

Q4) Refer to Exhibit 14.13. Which car should the student choose based on the Summary worksheet?

Q5) Refer to Exhibit 14.14. What formula is placed in cell B3 of the strategy table to complete the table as provided?

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Chapter 15: Project Management Online

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Sample Questions

Q1) Refer to Exhibit 15.1. What array formula is placed in cell H5 to calculate the Latest Finish Time?

A)E2 + D2

B)MAX(IF(ISNUMBER(FIND($A$2:$A$8,C5)),$F$2:$F$8))

C)H2 - D2

D)MIN(IF(ISERR(FIND(A5,$C$5:$C$17)),MAX($F$5:$F$17),$G$5:$G$17))

Q2) A weakness of Gantt charts is that they do not explicitly

A)indicate activity times.

B)show precedence relationships.

C)show activity start times.

D)show activity finish times.

Q3) Shortening the activity completion time is called

A)expediting

B)speeding

C)accelerating

D)crashing

Q4) Refer to Exhibit 15.4. Draw the CPM network for this problem. Use AON notation.

Q5) Refer to Exhibit 15.3. Draw the CPM network for this problem. Use AON notation.

Q6) Refer to Exhibit 15.5. What formula should go in cell H3 of the Costs spreadsheet to compute Crash Cost Per Day?

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