Question 1

In bidding models, the simulation output variable is the number of competitors who will bid.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following functions is not an @RISK statistical function?

Accepted Answer

A) RISKMIN 
B) RISKMAX 
C) RISKPERCENTILE 
D) RISKSIMTABLE 
A) RISKMIN 
B) RISKMAX 
C) RISKPERCENTILE 
D) RISKSIMTABLE

Question 3

Which of the following is typically not an application of simulation models?

Accepted Answer

A) Operations models 
B) Financial models 
C) Marketing models 
D) Logistics models 
A) Operations models 
B) Financial models 
C) Marketing models 
D) Logistics models

Question 4

Exhibit 11-1A company is considering investing $1.2M in a facility to manufacture a new product. The product will have a five year life, after which the facility will be shut down. A pro forma cash flow sheet for this project, with forecasted production levels, unit prices, and production costs, is shown below:
  
-[Part 4] Refer to Exhibit 11-1. What does the distribution of the project NPV look like?

Accepted Answer

The distribution is

Question 5

Exhibit 11-2Suppose we want to choose capacity for a plant that will produce a new drug. In particular, we want to choose the capacity that maximizes discounted expected profit over the next 10 years. Assume all cash flows occur at the end of the year. We have the following information:
∙Demand for the drug is expected to be normally distributed ˜ Normal (50,000, 12,000). Demand each year is an independent event.
∙A unit of capacity costs $16 to build in year 1.
∙The number of units produced will equal the demand, up to capacity limits.
∙The revenue per unit is $3.70 and the cost per unit is $0.20 (variable cost).
∙The maintenance cost per unit of capacity is $0.40 (fixed cost).
∙The discount rate is 10%.
-[Part 4] Refer to Exhibit 11-2. Are there any simulations which indicated there was a chance of getting negative NPV? Briefly explain in one sentence.

Accepted Answer

Yes. Both simulations 4 and 5 (Q=35,000

Question 6

Which of the following @RISK functions can be used to find the probability of a particular value in an output distribution?

Accepted Answer

A) RISKMIN 
B) RISKMAX 
C) RISKPERCENTILE 
D) RISKTARGET 
A) RISKMIN 
B) RISKMAX 
C) RISKPERCENTILE 
D) RISKTARGET

Question 7

In financial simulation models, we are typically more interested in the expected NPV of a project than in the extremes of the outcomes.

Accepted Answer

A) True 
 B)False

Question 8

In marketing and sales models, the primary issue is the uncertain amount of sales that can be obtained, given an assumed timing.

Accepted Answer

A) True 
 B)False

Question 9

RISKTARGET is a function that allows us to determine the cumulative probability of a particular value in an output distribution, such as the probability of meeting a due date in manufacturing.

Accepted Answer

A) True 
 B)False

Question 10

Value at risk (VAR) is an indicator of:

Accepted Answer

A) how much to bid for a project 
B) the expected amount of loss for a project 
C) what is nearly the worst possible outcome for a project 
D) the required amount of investment required for a project 
A) how much to bid for a project 
B) the expected amount of loss for a project 
C) what is nearly the worst possible outcome for a project 
D) the required amount of investment required for a project

In bidding models, the simulation output variable is the number of competitors who will bid.

Which of the following functions is not an @RISK statistical function?

Which of the following is typically not an application of simulation models?

Which of the following @RISK functions can be used to find the probability of a particular value in an output distribution?

In financial simulation models, we are typically more interested in the expected NPV of a project than in the extremes of the outcomes.

In marketing and sales models, the primary issue is the uncertain amount of sales that can be obtained, given an assumed timing.

RISKTARGET is a function that allows us to determine the cumulative probability of a particular value in an output distribution, such as the probability of meeting a due date in manufacturing.

Value at risk (VAR) is an indicator of:

Introduction to Modeling

Introduction to Spreadsheet Modeling

Introduction to Optimization Modeling

Linear Programming Models

Network Models

Optimization Models With Integer Variables

Nonlinear Optimization Models

Evolutionary Solver: An Alternative Optimization Procedure

Decision Making Under Uncertainty

Introduction to Simulation Modeling

Inventory and Supply Chain Models

Queuing Models

Regression and Forecasting Models

Filters

Exam 11: Simulation Models

In bidding models, the simulation output variable is the number of competitors who will bid.

Which of the following functions is not an @RISK statistical function?

Which of the following is typically not an application of simulation models?

Which of the following @RISK functions can be used to find the probability of a particular value in an output distribution?

In financial simulation models, we are typically more interested in the expected NPV of a project than in the extremes of the outcomes.

In marketing and sales models, the primary issue is the uncertain amount of sales that can be obtained, given an assumed timing.

RISKTARGET is a function that allows us to determine the cumulative probability of a particular value in an output distribution, such as the probability of meeting a due date in manufacturing.

Value at risk (VAR) is an indicator of:

Introduction to Modeling

Introduction to Spreadsheet Modeling

Introduction to Optimization Modeling

Linear Programming Models

Network Models

Optimization Models With Integer Variables

Nonlinear Optimization Models

Evolutionary Solver: An Alternative Optimization Procedure

Decision Making Under Uncertainty

Introduction to Simulation Modeling

Inventory and Supply Chain Models

Queuing Models

Regression and Forecasting Models

Filters