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  57. A Manufacturing company introduces two product alternatives. The table below provides profit payoffs in thousands of dollars. ? ?Bet onState of Nature (Demand) ?UpStableDown ?Product A1188 ?Product B81012 ? ? ? The probabilities for the state of nature are P(Up) = 0.35, P(Stable) = 0.35, and P(Down) = 0.30. A test market study of the potential demand for the product.
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61If the trade-toGDP ratio is 25% and the overall value of trade is $175 billion, then the GDP is ______. •$250 billion •$700 billion •$1 trillion •$0.5 trillion •the highest in the industrialized world. •greater than China's and Japan's. •smaller than that of Germany. •too high. 63If we measure the.
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  46. Visual Park is considering marketing one of its two television models for coming Christmas season: Model A or Model B. Model A is a unique featured television and appears to have no competition. Estimated profits (in thousand dollars) under high, medium, and low demand are given below:    Demand Model A High Medium Low Profit 1200 900 500 Probability 0.2 0.6 0.2   Visual Park is.
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  51. Consider a decision situation with four possible states of nature: s1, s2, s3, and s4. The prior probabilities are P(s1) = 0.35, P(s2) = 0.15, P(s3) = 0.20, P(s4) = 0.30. The conditional probabilities are P(C|s1) = 0.2, P(C|s2) = 0.09, P(C|s3) = 0.15, and P(C|s4) = 0.20. Find the.
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  43. Greentrop Pharmaceutical Products are the world leader in the area of sleep aids. Its major product is “Dozealot”. The Research-and-Development Division has defined two alternatives to improve the quality of the product. These alternatives are simple reformulations of the product to minimize the side effects and to improve the product.
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  45. The following payoff table shows the profit for a decision problem with three states of nature and three decision alternatives: Decision Alternative  State of Nature    s1 s2 s3 ? d1  7 3 4   d2  2 4 5   d3  8 2 3     a. Suppose P(s1) = 0.1, P(S2) = 0.3, and P(S3) = 0.6. What is the best decision using the expected value approach?b. Suppose that the probability of sate.
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  60. A company has improved its anti-virus program and has released a new version. Assume there is a 0.6 probability that the users of this anti-virus will upgrade the version in any particular year. That is, the upgrade year of the user is a geometric random variable. The revenue generated from.
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  41. Jasen Hansen is interested in leasing a sports-utility vehicle and has contacted three automobile dealers for pricing information. Each dealer offered Jasen a 24-month lease with no down payment due at the time of signing. Each lease includes a monthly cost, mileage allowances, and the cost for additional miles and.
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  21. The amount of loss (lower profit or higher cost) from not making the best decision for each state of nature is known as  a. best payoff.  b. opportunity loss.  c. risk profile.  d. utility. 22. The minimax regret approach is  a. purely optimistic.  b. purely conservative.  c. both purely optimistic and purely conservative.  d. neither purely optimistic nor purely conservative. 23. For a particular maximization problem, the payoff for best.
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  54. A specialty hedge fund is considering the purchase of a Jackson Pollock painting. It estimates the value of the painting to be $185 million. In an auction, both the number of competing bids and the amount of the competing bids is uncertain. The hedge fund has maintained a file summarizing.
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11Which of the following entries are considered to be exports of services? •Japanese buying soybeans from the United States    •Chinese selling iPods to the United States •Mexican tourists visiting the Grand Canyon •French wine sold to the United States 12Which of the following is included in trade flows? •sales or purchases.
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  52. A distributor has generated a rough estimate of aftershave demand at their retails store. The distributor is confident that demand will range from 100 to 650. The following table lists weights for demand values within this range. ? Demand 230 330 430 530 Weight 0.15 0.25 0.35 0.25 ? The distributor pays a wholesale price of $21 per aftershave and then sells at.
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  58. An entrepreneur who operates a cellular phone store orders inventory of cell phones based on four internal memory specifications – 8 GB, 16 GB, 32 GB, and 64 GB. She wants to evaluate her inventory ordering policy for the phones with four different amounts of internal memory. Any phone unsold.
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41Which of the following countries was an original member of the European Union when it was established in 1952? •Poland •Greece •The United Kingdom •Italy 42Which of the following economic groupings has the largest volume of trade among its member nations? •NAFTA •The European Union •The Free Trade Area of.
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  47. The quality of a device should be examined in the inspection department sequentially in three steps before it is sent to packaging department. The probability distributions for the time required to complete each of the activities are as follows: ? Step Time (minutes) Probability 1 3 0.15   5 0.25   7 0.35   9 0.25 2 11 0.25   13 0.30   15 0.45 3 8 0.35   10 0.20   12 0.45 a. Construct a spreadsheet simulation model to estimate the average time.
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  48. The Golden Jill Mining Company is interested in procuring 10,000 acres of coal mines in Powder River Basin. The mining company is considering two payment-plan options to buy the mines: I. 100% PaymentII. Installment-Payment The payoff received will be based on the quality of coal obtained from the mines which has been.
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21The difference in value between exports and imports in a particular nation is called: •a trade deficit. •bilateral trade balance. •balanced trade. •the trade balance. 22Whenever the value of exports is more than the value of imports for a particular nation, it is called: •a trade deficit. •a trade surplus..
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  54. Three decision makers have assessed payoffs for the following decision problem (payoff in dollars). ? Decision AlternativeState of Nature s1s2s3 d11540–20 d26080–80 ? The indifference probabilities are as follows:  Indifference Probability (p) PayoffDecision Maker ADecision Maker BDecision Maker C 80Does not applyDoes not applyDoes not apply 600.70.950.87 400.50.90.74 150.30.80.59 –200.150.60.37 –80Does not applyDoes not applyDoes not apply a. Plot the utility function for money for each.
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  56. A store is offering a discount on 800 pairs of basketball shoes. The amount of the discount varies and is not revealed to the customer until checkout. The distribution of discounts is given in the below table. Discount Rate (%) Number of Tags 5 250 20 220 35 120 50 80 65 70 90 60 How many pairs of shoes does a customer have to.
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  47. The Golden Jill Mining Company is interested in procuring 10,000 acres of coal mines in Powder River Basin. The mining company is considering two payment-plan options to buy the mines: I. 100% PaymentII. Installment-Payment The payoff received will be based on the quality of coal obtained from the mines which has been.
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  11. Chance nodes are  a. nodes provided at the end of the states-of-nature branches.  b. nodes indicating points where an uncertain event will occur.  c. nodes provided at the end of the decision alternative branches where a payoff is shown.  d. nodes indicating points where a decision is made. 12. Lines showing the alternatives from decision nodes and the outcomes from.
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  46. A football tournament is conducted between Team-A and Team-B of a college and the winner being the first team to win four games of seven games. The probability that Team-A wins each game  are as follows: Game 1 2 3 4 5 6 7 Probability of Win 0.48 0.5 0.45 0.6 0.55 0.40 0.55 ? a. Set up a spreadsheet simulation model in which whether Team-A wins each game.
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  53. Consider the table below with information regarding each activity, immediate predecessors, and duration estimates (in minutes) for each activity. Activity Immediate Predecessors Minimum Time Likely Time Maximum Time A — 6 7 9 B — 4 9 11 C A 3 9 12 D B 2 6 12 E B, C 3 5 10 F D 4 7 9 G E 4 7 15 a. Using the PERT distribution in ASP to represent the duration of each activity, construct a simulation model to compute the total time to complete the task. b..
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  31. A special case of sample information where the information tells the decision maker exactly which state of nature is going to occur is known as_____ information.  a. perfectb. mutual  c. conditionald. prior 32. _____ refers to the probability of one event, given the known outcome of a (possibly) related event.  a. Joint probabilityb. A priori probability  c. Decisive probabilityd. Conditional probability 33. Bayes’ theorem  a. can be used.
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  55. Three decision makers have assessed payoffs for the following decision problem (payoff in dollars). ? ? Decision AlternativeState of Nature s1s2s3 d11540–20 d26080–80 ? ? The indifference probabilities are as follows:  Indifference Probability (p) PayoffDecision Maker ADecision Maker BDecision Maker C 80Does not applyDoes not applyDoes not apply 600.70.950.85 400.50.90.7 150.30.80.55 –200.150.60.35 –80Does not applyDoes not applyDoes not apply If P(s1) = 0.30, P(s2) = 0.55, and P(s3).
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1. An uncertain future event affecting the consequence associated with a decision is known as a  a. chance event.  b. decision alternative.  c. decision node.  d. payoff. 2. A(n) _________ refers to the result obtained when a decision alternative is chosen and a chance event occurs.  a. payoff table  b. outcome  c. state of nature  d. node 3. _____________ are possible outcomes for chance events that affect the consequences associated with.
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  48. Team X is scheduled to play against Team Y in an upcoming game in Baseball’s World Series. Assume that each player’s point production can be represented as an integer uniform variable with the ranges provided in the following table: ?   Player Team X Team Y 1 [4,10] [2,4] 2 [2,6] [14,30] 3 [7,20] [2,20] 4 [3,5] [1,10] 5 [6,20] [8,20] 6 [5,10] [7,12] 7 [7,10] [14,20] 8 [12,40] [3,5] 9 [9,20] [14,25] a. Develop a spreadsheet model that simulates the points scored.
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49. Meega airlines decided to offer direct service from Akron to Clearwater Beach, Florida. Management must decide between full-price service using a company’s new fleet of jet aircraft and a discount-service using smaller capacity commuter planes. Management developed estimates of the contribution to profit for each type of service based upon.
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1What country was the world's largest exporter of goods in 2009? •China •Germany •the United States •Japan 2What country was the world's largest exporter of goods and services in 2009? •China •Germany •the United States •Japan 3What country was the world's largest exporter of services in 2009? •China •Germany •the United.
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51Which of the following statements about trade is true? •In 2006, the largest exporter to the United States was Canada. •Trade volume among China, Japan, Thailand, and Taiwan is the world's largest. •Trade volume among Chile, Brazil, Argentina, and Mexico is the world's largest. •The combined trade volume of the United.
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  50. The following table provides information about the profit payoff of an investment strategy. ? ? Decision Alternative State of Nature s1 s2 s3 s4 d1 52 44 44 36 d2 52 68 60 40 d3 36 36 36 44 Probability 0.3 0.2 0.4 0.1 ? a. What is the optimal decision strategy if perfect information were available?b. What is the expected value for the decision strategy developed in part a?c. Using the expected value approach, what is the recommended decision.
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  44. Meega airlines decided to offer direct service from Akron to Clearwater beach, Florida. Management must decide between full-price service using a company’s new fleet of jet aircraft and a discount-service using smaller capacity commuter planes. Management developed estimates of the contribution to profit for each type of service based upon.
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31How has China explained its growing bilateral imbalance with the United States? •Current accounting practices make it very difficult to determine the value added and true national origin of goods. •If the United States would only improve its efficiency, there  would be no gap. •Most Chinese imports are cheap consumer.
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  59. A branded store has outlets around the world that generates profit in the British pound, the New Zealand kiwi, and the Japanese yen. At the end of each quarter, the store converts the revenue from these three international outlets back into U.S. dollars, exposing itself to exchange rate risk. The.
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  42. Jasen Hansen is interested in leasing a sports-utility vehicle and has contacted three automobile dealers for pricing information. Each dealer offered Jasen a 24-month lease with no down payment due at the time of signing. Each lease includes a monthly cost, mileage allowances, and the cost for additional miles and.
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101Foreign direct investment (FDI) flows include: •purchase of a controlling interest in a foreign firm by a domestic firm. •purchase of stocks or bonds directly from an international dealer. •purchase of foreign government bonds by domestic investors. •accounts denominated in foreign currency in foreign banks owned by domestic depositors. 102Most FDI.
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91During the 2008–2009 financial crisis, what happened to international trade levels? •They rose. •They fell. •They did not change. •There is not enough data yet to say what happened to international trade levels. 92What caused the decline in trade during the 2008–2009 financial crisis? •rising house prices, which took up.
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  56. A manufacturing company introduces two product alternatives. The table below provides profit payoffs in thousands of dollars. ? ? ?Bet onState of Nature (Demand) ?UpStableDown ?Product A1188 ?Product B81012 ? The probabilities for the state of nature are P(Up) = 0.35, P(Stable) = 0.35, and P(Down) = 0.30. a. Use a decision tree to recommend a decision.b. Use EVPI.
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  55. A specialty hedge fund is considering the purchase of a Jackson Pollock painting. It estimates the value of the painting to be $185 million. In an auction, both the number of competing bids and the amount of the competing bids is uncertain. The hedge fund has maintained a file summarizing.
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  57. A store is offering a discount on 800 pairs of basketball shoes. The amount of the discount varies and is not revealed to the customer until checkout. The distribution of discounts is given in the below table. Discount Rate (%) Number of Tags 5 250 20 220 35 120 50 80 65 70 90 60 Use the negative binomial distribution to approximate the average number.
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  60. Consider an advertising company which has to decide on investing with the current team that has a 50 percent chance of earning a net profit of $35,000 and a 50 percent chance of losing $17,500 invested. a. Write the equation for the exponential function that approximates the advertising company’s utility function.b..
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  50. A tourist bus can accommodate 80 people and currently books up to 80 reservations. Past data shows that the tourist bus always accommodates all 80 reservations but that, on average, two people do not show up. To capture additional profit, the travel agent is considering an overbooking strategy in which.
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