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Study Resources (Business Management)

  58. Consider the data on investment made in four types of funds and returns from S&P 500. Mutual Fund Year 1 Year 2 Year 3 Year 4 Large-Cap Growth 41.54 36.18 32.76 -20.63 Large-Cap Value 32.45 44.78 28.61 38.49 Small-Cap Growth 26.13 7.04 -23.97 45.67 Small-Cap Value 37.56 18.53 27.53 -5.48 S&P 500 Return 33.15 27.62 15.84 30.42   a. Develop an optimization model that will give the fraction of the portfolio to invest in each of the funds so that the return.
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  49. Best Ink Printing Co. received an order to print a minimum of 50,000 tickets for a concert.  They have three printing machines available to meet the order they received. The set-up cost of these machines and the unit cost/ticket printed using each machine along with their maximum production are provided in.
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  46. An Electrical Company has two manufacturing plants. The cost in dollars of producing an Amplifier at each of the two plants is given below. The cost of producing Q1 Amplifiers at first plant is: 65Q1 + 4Q12+ 90 and the cost of producing Q2 Amplifiers at the second plant is 20Q2 + 2Q22+.
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  57. Greenbell Software Inc. conducted a study on its smartphone products in the market to determine which phone has the best features in terms of three prominent attributes: operating system of the phone (A or B), RAM (512MB or 1GB), and the rear camera specifications (3MP, 5MP, or 7MP). A sample.
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  21. All the values of computer-generated random numbers are  a. Poisson distributed.  b. lognormally distributed.  c. uniformly distributed.  d. normally distributed. 22. The __________ function is used to generate a pseudorandom number in Excel.  a. FREQUENCY()  b. RAND()  c. NORM.INV()  d. ROUND() 23. Which of the following parameters is required to convert a computer-generated random variable into a uniform random variable?  a. Range of the distributionb. Mean of the distribution  c. Variance of the distributiond. Moments of.
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56. Greenbell Software Inc. conducted a study on its smartphone products in the market to determine which phone has the best features in terms of three prominent attributes: operating system of the phone (A or B), RAM (512MB or 1GB), and the rear camera specifications (3MP, 5MP, or 7MP). A sample.
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  53. A manufacturer wants to construct warehouses in six different locations of the city to supply dry cells to his customers on time. The manufacturer wants to construct the minimum number of warehouses such that each warehouse is within 40 miles of at least one other warehouse. The following table provides.
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  41. Sunseel Industries produces different types of raw materials and it is interested in using simulation to estimate the profit per unit for its new product X. The selling price for the product will be $40 per unit. Probability distributions for the raw material cost, the production cost, and the marketing.
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  41. Jeff is willing to invest $5000 in buying shares and bonds of a company to gain maximum returns. From his past experience, he estimates the relationship between returns and investments made in this company to be: R = –2S2 – 9B2 – 4SB + 20S + 30B.         where, R = total returns in thousands.
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  31. In a simulation process, the error of the estimates of the output can be reduced by  a. increasing the range of possible values for the random variables.  b. increasing the number of random variables.  c. increasing the number of trials per simulation.  d. conducting regression analysis to forecast values. 32. According to the ___________, the sum of independent random variables.
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  49. Gatson manufacturing company is willing to promote 2 types of tires: Economy tire and Premium tire. These two tires are independent of each other in terms of demand, cost, price, etc. An analytics team of this company has estimated the profit functions for both the tires as Monthly profit for Economy.
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  52. Sansuit Investments is deciding on future investment for the coming two years and is considering four bonds. The investment details for the next two years are given in the table below.   Investment Requirements ($)   Year 1 Year 2 Bond A 25,000 30,000 Bond B 15,000 21,000 Bond C 8000 9500 Bond D 10,000 7000   The net worth of these four bonds at maturity is $60,000, $40,000,.
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  51. Sansuit Investments is deciding on future investments for the coming two years and is considering four bonds. The investment details for the next two years are given in the table below.   Investment Requirements ($)   Year 1 Year 2 Bond A 25,000 30,000 Bond B 15,000 21,000 Bond C 8000 9500 Bond D 10,000 7000 The net worth of these four bonds at maturity is $60,000, $40,000,.
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  42. Consider the objective function, where, Y = total output A= total-factor productivity L = labor input K= capital input á = capital input share of contribution for L â = capital input share of contribution for K a. Assume á = 0.33, â = 0.67, A = 10 and each unit of labor costs $45 and each.
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  47. A chocolate making company largely produces one particular type of crunchy chocolate bar. Only one of two machines, Machine-1 or Machine-2, can be used to produce this chocolate bar on any given day. The maintenance costs incurred on these two machines per day are $100 and $120, respectively. The manufacturing.
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  60. Consider the stock return data given below. Stock Month 1 Month 2 Month 3 Month 4 Month 5 A 12.07 10.12 14.54 46.58 -19.34 B 15.95 4.16 6.31 -2.74 6.54 C 30.52 16.51 34.25 45.62 -27.21 D 32.42 21.36 13.84 8.12 -6.84   Develop and solve the Markowitz model that maximizes expected return subject to a maximum variance of 35. Use this model to construct an efficient frontier by varying the maximum allowable variance from 25 to 55 in increments of 5.
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  60. Denver Transportation Company is considering investing in several projects that have varying capital requirements over the next four years. Faced with limited capital each year, management would like to select the most profitable projects that it can afford. The estimated net present value for each project, the capital requirements, and.
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  47. The exponential smoothing model is given by where        This model is used to predict the future based on the past data values. a. The observed values with the smoothing constant ? = 0.45 are given in the below table. The third column of the table displays the forecast values obtained using the.
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  44. An Investment firm offers free financial planning seminars at major hotels for groups of 30 individuals. Each seminar costs them $4,000 and the average first-year commission for each new enrollment is $6,000. The firm estimates that for each individual attending the seminar, there is a 0.05 probability that he/she will.
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  57. Consider the following data on the returns from bonds.   Year ? 1 2 3 4 5 6 7 8 Bond 1 0.200 0.026 0.121 -0.139 -0.167 0.135 0.152 0.175 Bond 2 0.128 0.100 0.125 -0.243 0.269 0.225 0.204 0.186 Bond 3 0.067 0.700 0.226 -0.184 0.234 -0.146 0.047 0.604   Develop and solve the Markowitz portfolio model using a required expected return of at least 15 percent. Assume that the 8 scenarios are equally likely to occur. Use this model to construct an efficient frontier by varying the expected.
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  56. Consider the following data on the returns from bonds.   Year ? 1 2 3 4 5 6 7 8 Bond 1 0.20 0.126 0.321 -0.39 -0.67 0.135 0.52 0.75 Bond 2 0.128 0.21 0.325 -0.243 0.169 0.125 0.304 0.286 Bond 3 0.167 0.27 0.426 -0.84 0.143 -0.46 0.147 0.704 a. Construct the Markowitz portfolio model using a required expected return of at least 15 percent. Assume that the 8 scenarios are equally likely to occur. b. Solve the model using Excel Solver.   .
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  45. A Steel Manufacturing company has two production facilities that manufacture Dishwashers. Production costs at the two facilities differ because of varying labor costs, local property taxes, type of material used, volume, and so on. For Plant A, the weekly costs for producing a number of units of Dishwashers is expressed.
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  43. A company has produced a new battery with an estimated mean lifetime of 60 hours. Management also believes that the standard deviation is 4.5 hours and that battery hours are normally distributed. To promote the new battery, management has offered to refund some money if the battery fails to reach.
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  59. Develop a model that minimizes semivariance for the data given below with a required return of 15 percent. Define a variable for each scenario and let  with = 0. Then make the objective function: Min .   Scenario Mutual Fund Year 1 Year 2 Year 3 Year 4 Large-Cap Growth 41.54 36.18 32.76 -20.63 Large-Cap Value 32.45 44.78 28.61 38.49 Small-Cap Growth 26.13 7.04 -23.97 45.67 Small-Cap Value 37.56 18.53 27.53 -5.48   Solve the model you developed with.
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  50. Light-Twilight Inc. currently has four factories where light bulbs are manufactured, but budget cuts are forcing the company to limit production to only two of the factories. Once produced, the light bulbs are shipped to five distribution centers. The cost, demand, and maximum volume details are given as below.   Shipping cost/1000.
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  48. A shipping freighter has space for two more shipping containers, but the combined weight cannot go over 20 tons. Four shipping containers are being considered. The following table provides details on the weight (in tons) and value of the contents of each container. Container 1 2 3 4 Weight of container (tons) 5 6 9 7 Value / Container $6000 $5500 $7500 $6000 Develop a binary.
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  11. The values for random variables in a Monte Carlo simulation are  a. selected manually.  b. generated randomly from probability distributions.  c. taken from forecasting analysis.  d. derived secondarily using formulas. 12. The choice of the probability distribution for a random variable can be guided by  a. an objective function.  b. likelihood factors.  c. forecasting.  d. historical data. 13. Which of the following inferences about a variable of interest can be.
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  55. Consider the stock return data given below. Stock Month 1 Month 2 Month 3 Month 4 Month 5 A 12.07 10.12 14.54 46.58 -19.34 B 15.95 4.16 6.31 -2.74 6.54 C 30.52 16.51 34.25 45.62 -27.21 D 32.42 21.36 13.84 8.12 -6.84   a. Construct the Markowitz model that maximizes expected return subject to a maximum variance of 35. b. Solve the model developed in part a. Round all your answers to three decimal places.   .
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  45. The stock price of Robin Tires, Inc., listed on the Stock Exchange is currently $20. The following probability distribution shows how the price per share is expected to change over a three-month period: ? Stock Profit Change ($) Probability –3 0.25 –2 0.2 –1 0.05 0 0.15 +1 0.1 +2 0.15 +3 0.1 ? a. Construct a spreadsheet simulation model that computes the value of the stock profit in.
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  46. Delisshious Toasty Chocolates Company primarily produces two types of chocolate bars, Almond Tasty and Cashew Crunchy. The personnel costs incurred per day to produce the two types of chocolate bars are $100 and $120, respectively. The production cost per chocolate bar is $2 for Almond Tasty and $2.5 for Cashew.
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  39. Which of the following conclusions can be drawn from the below figure using the Bass forecasting model? (Note:  Bass forecasting model is given by: Ft = (p + q[Ct – 1 /m]) (m – Ct – 1), where m = the number of people estimated to eventually adopt the new product,         Ct – 1.
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  42. Salemach Corporation is a start-up company that manufactures simple machines. It is interested in analyzing the profit from a new machine. It estimates that the selling price will be $150 per unit and the setup and advertising costs will total $250,000. The company estimates that the per unit raw material.
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  48. Consider the economic order quantity (EOQ) model for multiple products that are independent except for a budget restriction. The following model describes this situation Let Dk = annual demand for product k Ck = unit cost of product k Sk = cost per order placed for product k i = inventory carrying charge as.
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  11. A feasible solution is __________ if there are no other feasible points with a better objective function value in the entire feasible region.  a. infeasible  b. unbounded  c. nonlinear  d. a global optimum 12. If there are no other feasible points with a larger objective function value in the entire feasible region, a feasible solution is  a. an efficient frontier.  b. a global maximum.  c. not.
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  55. To meet excess demand for the pizza home delivery services, ROFiL Pizza is planning to open new stores in various regions. The store locations that are under consideration and their coverage areas are given in the following table. ? Store Location Potential Areas Covered L1     3, 4, 6, 8 L2 1, 5, 9 L3 1, 4, 7 L4 2, 6, 7 L5 3,.
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  31. If the portfolio variance were equal to zero, the amount of risk would be  a. unity.b. a positive number greater than 1.  c. negative always.d. zero. 32. One of the ways to formulate the Markowitz model is to  a. maximize the variance of the portfolio subject to a constraint on the expected return of the portfolio.  b. minimize the expected return of.
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  54. 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. ? Store Location Potential Areas Covered L1     3, 4, 6, 8 L2 1, 5, 9 L3 1, 4, 7 L4 2, 6, 7 L5 3, 4,.
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1. A ___________ uses repeated random sampling to represent uncertainty in a model representing a real system and that computes the values of model outputs.  a. Monte Carlo simulation  b. what-if analysis  c. deterministic model  d. discrete event simulation 2. A simulation model extends spreadsheet modeling by  a. extending the range of parameters for which solutions are computed.  b. using real-time values for parameters from.
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  54. Consider the return scenario for 3 types of mutual funds, shown in the following table:   Scenario Mutual Fund 1 2 3 4 5 6 X -33.8 12.1 129.9 137.7 -55.5 16.3 Y -45.5 15.8 58.9 34.6 -39.8 -64.5 Z -11.8 128.8 164.4 17.8 -43.4 -32.3   a. Develop the Markowitz portfolio model for these data with a required expected return of at least 20 percent. Assume that the six scenarios are equally likely to occur. b. Solve the model developed in part.
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1. In a nonlinear optimization problem  a. the objective function is a nonlinear function of the constraints.  b. all the constraints are nonlinear only when the objective is to maximize the function of the decision variables.  c. at least one term in the objective function or a constraint is nonlinear.  d. both the objective function and the constraints must.
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  58. Andrew is ready to invest $200,000 in stocks and he has been provided nine different alternatives by his financial consultant. The following stocks belong to three different industrial sectors and each sector has three varieties of stocks each with different expected rate of return. The average rate of return taken.
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  21. In reviewing the image below, what is the minimum value for this function?  a. –8  b. 0  c. –1  d. 1 22. Using the graph given below, which of the following equations is most likely to yield the above curve?  a. f(X, Y) = Xlog(2ðY) + Ylog(2ðX)  b. f(X, Y) = X – Y  c. f(X, Y) = –X2 – Y2  d. f(X, Y) = Xsin(5ðX) + Ysin(5ðY) 23. Using.
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  59. Andrew is ready to invest $200,000 in stocks and he has been provided nine different alternatives by his financial consultant. The following stocks belong to three different industrial sectors and each sector has three varieties of stocks each with different expected rate of return. The average rate of return taken.
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