Question 1

If a decision maker has to make a particular decision only once,expected monetary value is a good indication of the payoff associated with the decision.

Accepted Answer

A) True 
 B)False  False

Question 2

What is a conditional value?

Accepted Answer

It is an outcome of a particular alternative/state of nature combination.

Question 3

A decision maker using the maximax criterion on the problem below would choose Alternative ________ because the maximum of the row maximums is ________.

Accepted Answer

A) A; 60 
B) B; 80 
C) C; 70 
D) D; -100 
E) D; 140 
A) A; 60 
B) B; 80 
C) C; 70 
D) D; -100 
E) D; 140 E

Question 4

The last step of the decision-making process is to:

Accepted Answer

A) develop a model. 
B) evaluate each alternative. 
C) select the best alternative. 
D) implement the decision. 
E) check the decision with senior management. 
A) develop a model. 
B) evaluate each alternative. 
C) select the best alternative. 
D) implement the decision. 
E) check the decision with senior management.

Question 5

All EXCEPT which of the following steps are taken to analyze problems with decision trees?

Accepted Answer

A) Define the problem. 
B) Structure or draw the decision tree. 
C) Assign probabilities to the alternatives. 
D) Estimate payoffs for each possible alternative/state of nature combination. 
E) Solve the problem by computing expected monetary values for each state-of-nature node. 
A) Define the problem. 
B) Structure or draw the decision tree. 
C) Assign probabilities to the alternatives. 
D) Estimate payoffs for each possible alternative/state of nature combination. 
E) Solve the problem by computing expected monetary values for each state-of-nature node.

Question 6

If a decision maker can assign probabilities of occurrences to the states of nature,then the decision-making environment is Decision Making under Uncertainty.

Accepted Answer

A) True 
 B)False

Question 7

Earl Shell owns his own Sno-Cone business and lives 30 miles from a beach resort.The sale of Sno-Cones is highly dependent upon his location and upon the weather.At the resort,he will profit $120 per day in fair weather,$10 per day in bad weather.At home,he will profit $70 in fair weather,$55 in bad weather.Assume that on any particular day,the weather service suggests a 40% chance of foul weather.
a.Construct Earl's decision tree.
b.What decision is recommended by the expected value criterion?

Accepted Answer

Resort has

Question 8

What is the outcome of an alternative/state of nature combination called?

Accepted Answer

A) price 
B) conditional value 
C) expected value 
D) conditional probability 
E) conditional expectation 
A) price 
B) conditional value 
C) expected value 
D) conditional probability 
E) conditional expectation

Question 9

An operations manager's staff has compiled the information below for four manufacturing alternatives (E,F,G,and H)that vary by production technology and the capacity of the machinery.All choices enable the same level of total production and have the same lifetime.The four states of nature represent four levels of consumer acceptance of the firm's products.Values in the table are net present value of future profits in millions of dollars.Forecasts indicate that there is a 0.1 probability of acceptance level 1,0.2 chance of acceptance level 2,0.4 chance of acceptance level 3,and 0.3 change of acceptance level 4.
   Using the criterion of expected monetary value,which production alternative should be chosen?

Accepted Answer

The expected values are: E = .1(50)+ .2(

Question 10

A poker player is considering three different options after his opponent bet 200 before him.If the player folds,he will lose instantly.If the player calls,he figures he will win half the time.If he raises,he figures that the opposing player will not re-raise him,but rather will either call or fold.He figures the opposing player will call only ¼ of the time,folding the other ¾ of the time.If the opposing player calls his raise,he figures he will never win.The pot size is 1,000 (including the opposing player's bet).
a.Draw a decision tree for this scenario including the information provided in part b.
b.Suppose that the player is thinking of raising to $400 (he will put in 200 to match the opponent's bet and another 200 as a raise,his opponent would then have to put in 200 more to call the raise).Is this the best option or should he instead call or fold?
c.At what raise size is the player's EMV of a raise equivalent to simply calling?

Accepted Answer

a. @#IMG-DLM& b.EMV of a fold is 0,EMV of a call i

Question 11

A(n)________ is a graphical means of analyzing decision alternatives and states of nature.

Accepted Answer

The answer of A(n)________ is a graphical means of analyzing...

Question 12

Daily sales of bread by Salvador Monella's Baking Company follow the historical pattern shown in the table below.It costs the bakery 50 cents to produce a loaf of bread,which sells for 95 cents.Any bread unsold at the end of the day is sold to the parish jail for 25 cents per loaf.Construct the decision table of conditional payoffs.How many loaves should Sal bake each day in order to maximize contribution?

Accepted Answer

The Excel OM decision table an

Question 13

The first step,and a key element,in the decision-making process is to:

Accepted Answer

A) consult a specialist. 
B) clearly define the problem. 
C) develop objectives. 
D) monitor the results. 
E) select the best alternative. 
A) consult a specialist. 
B) clearly define the problem. 
C) develop objectives. 
D) monitor the results. 
E) select the best alternative.

Question 14

Decision trees and decision tables can both solve problems requiring a single decision,but decision tables are the preferred method when a sequence of decisions is involved.

Accepted Answer

A) True 
 B)False

Question 15

Identify and describe three methods used for decision making under conditions of uncertainty.

Accepted Answer

(1)Maximax is a criterion that finds an

Question 16

If a decision maker knows for sure which state of nature will occur,he/she is making a decision under certainty.

Accepted Answer

A) True 
 B)False

Question 17

The likelihood that a decision maker will ever receive a payoff precisely equal to the EMV when making any one decision is:

Accepted Answer

A) low (near 0%). 
B) high (near 100%). 
C) dependent upon the number of alternatives. 
D) dependent upon the number of states of nature. 
E) none of the above 
A) low (near 0%). 
B) high (near 100%). 
C) dependent upon the number of alternatives. 
D) dependent upon the number of states of nature. 
E) none of the above

Question 18

Identify,in order,the six steps of analytical decision making.

Accepted Answer

1.Clearly define the problem and factors

Question 19

Expected monetary value is most appropriate for problem solving that takes place:

Accepted Answer

A) when conditions are average. 
B) when all states of nature are equally likely. 
C) when all alternatives are equally likely. 
D) under conditions of uncertainty. 
E) under conditions of risk. 
A) when conditions are average. 
B) when all states of nature are equally likely. 
C) when all alternatives are equally likely. 
D) under conditions of uncertainty. 
E) under conditions of risk.

Question 20

What is a tabular presentation that shows the outcome for each decision alternative under the various possible states of nature called?

Accepted Answer

A) isoquant table 
B) payback period matrix 
C) payoff table 
D) feasible region 
E) decision tree 
A) isoquant table 
B) payback period matrix 
C) payoff table 
D) feasible region 
E) decision tree

Exam 22: Decision-Making Tools

If a decision maker has to make a particular decision only once,expected monetary value is a good indication of the payoff associated with the decision.

What is a conditional value?

A decision maker using the maximax criterion on the problem below would choose Alternative ________ because the maximum of the row maximums is ________.

The last step of the decision-making process is to:

All EXCEPT which of the following steps are taken to analyze problems with decision trees?

If a decision maker can assign probabilities of occurrences to the states of nature,then the decision-making environment is Decision Making under Uncertainty.

What is the outcome of an alternative/state of nature combination called?

A(n)________ is a graphical means of analyzing decision alternatives and states of nature.

The first step,and a key element,in the decision-making process is to:

Decision trees and decision tables can both solve problems requiring a single decision,but decision tables are the preferred method when a sequence of decisions is involved.

Identify and describe three methods used for decision making under conditions of uncertainty.

If a decision maker knows for sure which state of nature will occur,he/she is making a decision under certainty.

The likelihood that a decision maker will ever receive a payoff precisely equal to the EMV when making any one decision is:

Identify,in order,the six steps of analytical decision making.

Expected monetary value is most appropriate for problem solving that takes place:

What is a tabular presentation that shows the outcome for each decision alternative under the various possible states of nature called?

Operations and Productivity

Operations Strategy in a Global Environment

Project Management

Forecasting

Design of Goods and Services

Managing Quality

Process Strategy

Capacity and Constraint Management

Location Strategies

Layout Strategies

Human Resources, job Design, and Work Measurement

Supply Chain Management

Inventory Management

Aggregate Planning and Sop

Material Requirements Planning Mrpand Erp

Short-Term Scheduling

Jit, tps, and Lean Operations

Maintenance and Reliability

Sustainability in the Supply Chain

Statistical Process Control

Supply Chain Management Analytics

Linear Programming

Transportation Models

Waiting-Line Models

Learning Curves

Simulation

Filters

A decision maker using the maximax criterion on the problem below would choose Alternative because the maximum of the row maximums is .