M-3 Data-Driven Decision Making

A craftsman builds two kinds of birdhouses.  One for bluebirds and one for cardinals.  He knows the amount of labor and the units of lumber that are needed for each birdhouse.  The craftsman has available 60 hours of labor and 120 units of lumber.  Which technique should the craftsman use to minimize cost?

• Simulation

• Linear Regression

• Linear Programming

• Breakeven

Ski Boards, Inc. wants to enter the market quickly with a new finish on its ski boards.  It has three choices:  refurbish the old equipment, make major modifications or purchase new equipment.  The company has estimated the fixed and variable cost for each option.  Which technique should they use to select the least costly option?

• Breakeven

• Linear Regression

• Linear Programming

• Cross Over

Which analysis technique can be used with hypothesis testing when nominal or categorical data is gathered?

• Z-score

• Chi-square

• t-test

• ANOVA

United Motors indicates that gas mileage tests of one of their cars, the Starbird 300, under city driving conditions has a mean of 29.9 mph and a mode of 30 mph.  Which type of distribution would this testing represent?

• Pareto distribution

• Bimodal distribution

• Multimodal distribution

• Normal distribution

North American Oil Company is attempting to develop a reasonably priced gasoline that will deliver improved gasoline mileage.  As part of its development process, the company would like to compare the effects of three types of gasoline.  Which analysis technique should the company use to compare the performances of each gasoline type?

• t-test

• ANOVA

• Z-test

• Chi-square

Enterprise Industries produces Fresh, a brand of liquid laundry detergent.  In order to study the relationship between price and demand for the large bottle of Fresh, the company develops the following relationship:  Demand = 600 + 50X.  What price is needed to produce a demand of 1000?

• $6

• $8

• $10

• $12

A large manufacturer wants to forecast demand for a piece of pollution-control equipment.  A review of the past 12 months of sales indicates that sales are increasing. What time series pattern does the sales likely exhibit?

• Cyclicality

• Trend

• Seasonality

• Random variation

A car dealership wishes to forecast car sales based upon price discounts and television ads.  What forecasting technique should the dealership use?

• Time series analysis

• Cluster analysis

• Decision Analysis

• Multiple Regression Analysis

A city hospital wishes to evaluate the labor hours it needs based upon monthly occupied bed days and average length of patients’ stay.  The estimated regression is:  y = 2000 + 75X1 + 65X2   What scenario would be predicted if X1 = 500 and X2 = 1000?

• 102,500

• 67,000

• 104,500

• 110,800

Refers to a situation in which two or more explanatory or independent variables in a multiple regression model are highly linearly related.

• Autocorrelation

• Multicollinearity

• Homoscedasticity

• Heteroscedasticity