Question

1.

Which of the following best describes the relationship between cost and accuracy in forecasting?

	a.	low cost methods are always less accurate
	b.	statistical methods are more costly and more accurate
	c.	there is a trade‑off between cost and accuracy
	d.	cost should not be considered in business forecasting

2.

Decision models are applicable when

	a.	there is only one alternative
	b.	there are multiple states of nature
	c.	there is only one state of nature
	d.	there are multiple alternatives

3.

In decision-making, luck

	a.	can be ignored
	b.	cannot be quantified
	c.	often plays a role in determining whether good or bad outcomes occur
	d.	can be quantified

4.

In a PERT network the time required to complete a path is a(n)

	a.	Poisson distributed variable
	b.	constant
	c.	random variable
	d.	exponentially distributed variable

5.

The main difference between CPM and PERT is that

	a.	CPM is best for longer projects
	b.	PERT is probabilistic
	c.	PERT is deterministic
	d.	CPM requires 3 duration estimates for each activity

Answer 1

1. (Option c) there is a tradeoff between cost and accuracy

2. (Option d) there are multiple alternatives

3. (Option a) can be ignored

4. (Option c) random variable

5. (Option b) PERT is probabilistic