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A persistent tendency for forecasts to be greater than or less than the actual values is called: (Textbook Question)

University of Minnesota BOARD OF REGENTS POLICY Code of Conduct   Act Ethically and with Integrity. Ethical conduct is a fundamental expectation for every community member. In practicing and modeling ethical conduct, community members are expected to: act according to the highest ethical and professional standards of conduct; be personally accountable for individual actions; fulfill obligations owed to students, advisees, and colleagues; conscientiously meet University responsibilities; and communicate ethical standards of conduct through instruction and example. As a student of Decision Making in Operations class taught by Dr. Wenqing Zhang, I hereby certify that I will not discuss with any other students the contents and answers of this exam, and will make sure the exam is returned to the professor without any delay, in order to keep the examination process fair for everyone.  I certify this under the rules and regulations governing the Academic Integrity Policy of the University of Minnesota.   Have you read, understood and agreed upon this commitment statement?

A small building contractor has recently experienced two successive years in which work opportunities exceeded the firm’s capacity. The contractor must now make a decision on capacity for next year. Estimated profits under each of the two possible states of nature are as shown in the table below.    Next Year’s Demand Alternative Low High Do nothing $50 $60 Expand 20 80 Subcontract 40 70   Which alternative should be selected if the decision criterion is minimax regret?  (Study Guide Question)

The following is a payoff table of a decision that you should make. Using Minimax Regret decision approach, what is your optimal decision? Possible Future Demand Alternatives Low Moderate High 1 10 10 10 2 7 12 12 3 2 14 14 4 -4 2 16 (Class Example)

To _____ an activity means to shorten the time it will take.

The postmaster of a small western town receives a certain number of complaints each day about mail delivery. Determine three-sigma control limits using the following data.  Day 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Comp. 4 10 14 8 9 6 5 12 13 7 6 4 2 10 What is the UCL?  (Study Guide Question)

The advertising manager for Roadside Restaurants, Inc., needs to decide whether to spend this month’s budget for advertising on print media, television, or a mixture of the two. She estimates that the cost per thousand “hits” (readers or viewers) will vary depending upon the success of the new cable television network she plans to use, as follows: Strategy Cable Network Successful Failure Print $10 10 Mixed 4 14 Television 1 21   If she uses the maximin criterion, which advertising strategy will she use? (Variant of Class Example)

Compute the seasonal relative for quarter 1 for this data using the centered moving average method. Quarter Year 1 Year 2 1 2 3 2 6 10 3 2 6 4 5 9

An electrical contractor’s records during the last five weeks indicate the number of job requests: Week:             1          2          3          4          5 Requests:          20        22        18        21        22 Predict the number of requests for week 6 using the following method:   Exponential smoothing with α=.30. Use 20 for week 2 forecast.

Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Actual demand and the two sets of forecasts are as follows: Predicted Demand Period Demand F1 F2 1 68 66 66 2 75 68 68 3 70 72 70 4 74 71 72 5 69 72 74 6 72 70 76 7 80 71 78 8 78 74 80 What is the MAD for F1?