Management Science Quiz Chapter 1

Topics: Decision theory, Variable cost, Costs Pages: 26 (5280 words) Published: June 6, 2012
Introduction to Management Science, 10e (Taylor)
Chapter 1 Management Science

1) Management science involves the philosophy of approaching a problem in a subjective manner. Answer: FALSE
Diff: 1Page Ref: 2
Main Heading: The Management Science Approach to Problem Solving Key words: scientific approach

2) Management science techniques can be applied only to business and military organizations. Answer: FALSE
Diff: 1Page Ref: 2
Main Heading: The Management Science Approach to Problem Solving Key words: scientific approach, problem solving

3) Once management scientist makes his or her decision and recommendation to management, then typically, his or her involvement with the problem is finished. Answer: FALSE
Diff: 2Page Ref: 6
Main Heading: The Management Science Approach to Problem Solving Key words: management science, management scientist

4) A variable is a value that is usually a coefficient of a parameter in an equation. Answer: FALSE
Diff: 1Page Ref: 3
Main Heading: The Management Science Approach to Problem Solving Key words: variable

5) Parameters are known, constant values that are usually coefficients of variables in equations. Answer: TRUE
Diff: 1Page Ref: 4
Main Heading: The Management Science Approach to Problem Solving Key words: parameter

6) Data are pieces of information from the problem environment. Answer: TRUE
Diff: 1Page Ref: 4
Main Heading: The Management Science Approach to Problem Solving Key words: data

7) A model is a mathematical representation of a problem situation including variables, parameters, and equations. Answer: TRUE
Diff: 1Page Ref: 3
Main Heading: The Management Science Approach to Problem Solving Key words: model, management science techniques

8) A management science technique usually applies to a specific model type. Answer: TRUE
Diff: 1Page Ref: 3
Main Heading: The Management Science Approach to Problem Solving Key words: models, management science techniques
9) The first step of the management science process is to define the problem. Answer: FALSE
Diff: 2Page Ref: 2
Main Heading: The Management Science Approach to Problem Solving Key words: management science process

10) Management science modeling techniques provide results that are known with certainty. Answer: FALSE
Diff: 2Page Ref: 5
Main Heading: The Management Science Approach to Problem Solving Key words: management science modeling techniques, certainty

11) The term sensitivity analysis refers to testing how a problem solution reacts to changes in one or more of the model parameters. Answer: TRUE
Diff: 1Page Ref: 10
Main Heading: Model Building: Break-Even Analysis
Key words: sensitivity analysis, parameter changes

12) Fixed costs depend on the number of items produced.
Answer: FALSE
Diff: 1Page Ref: 7
Main Heading: Model Building: Break-Even Analysis
Key words: fixed cost, break-even analysis

13) Variable costs depend on the number of items produced.
Answer: TRUE
Diff: 1Page Ref: 7
Main Heading: Model Building: Break-Even Analysis
Key words: variable cost, break-even analysis

14) Fixed cost is the difference between total cost and total variable cost. Answer: TRUE
Diff: 1Page Ref: 7
Main Heading: Model Building: Break-Even Analysis
Key words: total cost, break-even analysis

15) The break-even point is the volume that equates total revenue with total cost. Answer: TRUE
Diff: 1Page Ref: 9
Main Heading: Model Building: Break-Even Analysis
Key words: break-even analysis

16) In general, an increase in price increases the break even point if all costs are held constant. Answer: FALSE
Diff: 1Page Ref: 10
Main Heading: Model Building: Break-Even Analysis
Key words: break-even analysis
17) If variable costs increase, but price and fixed costs are held constant, the break even point will decrease. Answer: FALSE
Diff: 2Page Ref: 11
Main Heading: Model Building:...
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