Question 1

If the coefficient of each squared term in a quadratic function is positive,the function is

Accepted Answer

A) concave. 
B) convex. 
C) elliptical. 
D) sinusoidal. 
A) concave. 
B) convex. 
C) elliptical. 
D) sinusoidal.

Question 2

Explain the differences between the LP formulations for a conservative portfolio and moderate-risk portfolio.​

Accepted Answer

The LP (linear programming) formulations

Question 3

To develop a portfolio that provides the best return possible with a minimum risk,the linear programming model will have an objective function which

Accepted Answer

A) minimizes the maximum risk. 
B) minimizes total risk. 
C) maximizes return and minimizes risk. 
D) maximizes the minimum return. 
A) minimizes the maximum risk. 
B) minimizes total risk. 
C) maximizes return and minimizes risk. 
D) maximizes the minimum return.

Question 4

Revenue management methodology was originally developed for

Accepted Answer

A) a cruise line. 
B) an airline. 
C) a car rental company. 
D) a hotel chain. 
A) a cruise line. 
B) an airline. 
C) a car rental company. 
D) a hotel chain.

Question 5

Which of the following is not true regarding a concave function?

Accepted Answer

A) It is bowl-shaped down. 
B) It is relatively easy to maximize. 
C) It has multiple local maxima. 
D) It has a single global maximum. 
A) It is bowl-shaped down. 
B) It is relatively easy to maximize. 
C) It has multiple local maxima. 
D) It has a single global maximum.

Question 6

For a minimization problem,a point is a global minimum if there are no other feasible points with a smaller objective function value.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is incorrect?

Accepted Answer

A) A global optimum is a local optimum in a nonlinear optimization problem. 
B) A local maximum is a global maximum in a concave nonlinear optimization problem. 
C) A global minimum is a local minimum in a convex nonlinear optimization problem. 
D) A local optimum is a global optimum in a nonlinear optimization problem. 
A) A global optimum is a local optimum in a nonlinear optimization problem. 
B) A local maximum is a global maximum in a concave nonlinear optimization problem. 
C) A global minimum is a local minimum in a convex nonlinear optimization problem. 
D) A local optimum is a global optimum in a nonlinear optimization problem.

Question 8

A linear programming application used to measure the relative efficiency of operating units with the same goals and objectives is

Accepted Answer

A) game theory. 
B) asset allocation. 
C) revenue management. 
D) data envelopment analysis. 
A) game theory. 
B) asset allocation. 
C) revenue management. 
D) data envelopment analysis.

Question 9

Because most nonlinear optimization codes will terminate with a local optimum,the solution returned by the codes will be the best solution.

Accepted Answer

A) True 
 B)False

Question 10

Mountainside State Park has four visitor centers.To study the operation of these centers,a DEA model has been developed that compares inputs (size,number of staff,weekly hours of operation)and outputs (% of visitors attending educational program,daily sales in gift shop).The computer solution is shown below.What can you conclude about the efficiency of the North center?
LINEAR PROGRAMMING PROBLEM
OPTIMAL SOLUTION
Objective Function Value = 1.000
 
Min $\quad$ E $+ 0 w n + 0 w s + 0 w e + 0 w w$
S.T. 1) $- 400 \mathrm { E } + 400 w n + 1200 w s + 2400 w e + 1500 w w$
2) $- 3 \mathrm { E } + 3 w n + 6 w s + 10 w e + 7 w w  0$
5) $- 38 \mathrm { E } + 38 w n + 425 w s + 1200 w e + 630 w w > 0$
$6 ) + 1 w n + 1 w s + 1 w e + 1 w w = 1$
 $$\begin{array} { l l l } 
\text { Variable } & \text { Value } & \text { Reduced Cost } \
\text { E } & 1.000 & 0.000 \
\text { wn } & 1.000 & 0.000 \
\text { ws } & 0.000 & 0.000 \
\text { we } & 0.000 & 0.000 \
\text { ww } & 0.000 & 0.000
\end{array}$$

Accepted Answer

Because E = 1,the composite vi

Question 11

For a typical nonlinear problem,duals price are relatively insensitive to small changes in right-hand side values.

Accepted Answer

A) True 
 B)False

Question 12

MegaSports,Inc.produces two high-priced metal baseball bats,the Slugger and the Launcher,that are made from special aluminum and steel alloys.The cost to produce a Slugger bat is $100,and the cost to produce a Launcher bat is $120.We can not assume that MegaSports will sell all the bats it can produce.As the selling price of each bat model - Slugger and Launcher - increases,the quantity demanded for each model goes down.
Assume that the demand,S,for Slugger bats is given by S = 640 − 4PS and the demand,L,for Launcher bats is given by L = 450 − 3PL where PS is the price of a Slugger bat and PL is the price of a Launcher bat.The profit contributions are PSS − 100S for Slugger bats and PLL − 120L for Launcher bats.Develop the total profit contribution function for this problem.

Accepted Answer

Solving S = 640 − 4P_S for P_S we get: P_S = 1

Question 13

A key trade-off in most portfolio optimization models must be made between risk and return.

Accepted Answer

A) True 
 B)False

Question 14

The goal of portfolio models is to create a portfolio that provides the best balance between risk and return.

Accepted Answer

A) True 
 B)False

Question 15

Portfolio manager Max Gaines needs to develop an investment portfolio for his conservative clients.His task is to determine the proportion of the portfolio to invest in each of the five mutual funds listed below so that the portfolio provides the best return possible with a minimum risk.Formulate the maximin linear program.

Accepted Answer

Max M
IS + LC + MC + SC + IB = 1 (Total

Question 16

A function is quadratic if its nonlinear terms have a power of 4.

Accepted Answer

A) True 
 B)False

Question 17

Portfolio manager Max Gaines needs to develop an investment portfolio for his clients who are willing to accept a moderate amount of risk.His task is to determine the proportion of the portfolio to invest in each of the five mutual funds listed below so that the portfolio provides an annual return of no less than 3%.Formulate the appropriate linear program.

Accepted Answer

Max 13.093IS + 12.315LC + 10.365MC + 7.4

Question 18

A feasible solution is a global optimum if there are no other feasible solutions with a better objective function value in the immediate neighborhood.

Accepted Answer

A) True 
 B)False

Question 19

List several types of organizations with multiple operating units where data envelopment analysis might be applied and give examples of possible inputs and outputs for each organization.​

Accepted Answer

Data envelopment analysis (DEA) can be a

Question 20

Revenue management methodology enables an airline to

Accepted Answer

A) maximize the number of full-fare seats it sells on each flight. 
B) minimize the number of discount-fare seats it sells on each flight. 
C) increase the average number of passengers per flight. 
D) decrease the number of overbooked flights. 
A) maximize the number of full-fare seats it sells on each flight. 
B) minimize the number of discount-fare seats it sells on each flight. 
C) increase the average number of passengers per flight. 
D) decrease the number of overbooked flights.

If the coefficient of each squared term in a quadratic function is positive,the function is

Explain the differences between the LP formulations for a conservative portfolio and moderate-risk portfolio.

To develop a portfolio that provides the best return possible with a minimum risk,the linear programming model will have an objective function which

Revenue management methodology was originally developed for

Which of the following is not true regarding a concave function?

For a minimization problem,a point is a global minimum if there are no other feasible points with a smaller objective function value.

Which of the following is incorrect?

A linear programming application used to measure the relative efficiency of operating units with the same goals and objectives is

Because most nonlinear optimization codes will terminate with a local optimum,the solution returned by the codes will be the best solution.

For a typical nonlinear problem,duals price are relatively insensitive to small changes in right-hand side values.

A key trade-off in most portfolio optimization models must be made between risk and return.

The goal of portfolio models is to create a portfolio that provides the best balance between risk and return.

A function is quadratic if its nonlinear terms have a power of 4.

A feasible solution is a global optimum if there are no other feasible solutions with a better objective function value in the immediate neighborhood.

List several types of organizations with multiple operating units where data envelopment analysis might be applied and give examples of possible inputs and outputs for each organization.

Revenue management methodology enables an airline to

Introduction

Introduction to Probability

Probability Distributions

Decision Analysis

Utility Game Theory

Time Series Analysis Forecasting

Intro to Linear Programming

LP Sensitivity Analysis

LP Applications

Distribution Network Models

Integer Linear Programming

Project Scheduling

Inventory Models

Waiting Line Models

Simulation

Markov Processes

Filters

Exam 12: Advanced Optimization Applications

If the coefficient of each squared term in a quadratic function is positive,the function is

Explain the differences between the LP formulations for a conservative portfolio and moderate-risk portfolio.​

To develop a portfolio that provides the best return possible with a minimum risk,the linear programming model will have an objective function which

Revenue management methodology was originally developed for

Which of the following is not true regarding a concave function?

For a minimization problem,a point is a global minimum if there are no other feasible points with a smaller objective function value.

Which of the following is incorrect?

A linear programming application used to measure the relative efficiency of operating units with the same goals and objectives is

Because most nonlinear optimization codes will terminate with a local optimum,the solution returned by the codes will be the best solution.

For a typical nonlinear problem,duals price are relatively insensitive to small changes in right-hand side values.

A key trade-off in most portfolio optimization models must be made between risk and return.

The goal of portfolio models is to create a portfolio that provides the best balance between risk and return.

A function is quadratic if its nonlinear terms have a power of 4.

A feasible solution is a global optimum if there are no other feasible solutions with a better objective function value in the immediate neighborhood.

List several types of organizations with multiple operating units where data envelopment analysis might be applied and give examples of possible inputs and outputs for each organization.​

Revenue management methodology enables an airline to

Introduction

Introduction to Probability

Probability Distributions

Decision Analysis

Utility Game Theory

Time Series Analysis Forecasting

Intro to Linear Programming

LP Sensitivity Analysis

LP Applications

Distribution Network Models

Integer Linear Programming

Project Scheduling

Inventory Models

Waiting Line Models

Simulation

Markov Processes

Filters

Explain the differences between the LP formulations for a conservative portfolio and moderate-risk portfolio.

List several types of organizations with multiple operating units where data envelopment analysis might be applied and give examples of possible inputs and outputs for each organization.