FARAH HANIM BINTI ABDUL WAHID 2011522697 ACS1125A ASSIGNMENT 1b DUE DATE: 6/12/2013 (5pm) Multiple Choice Questions

Question 1 Two properties of random number tables are A) uniformity and randomness B) normality and order C) independence and normality D) independence and uniformity Question 2 Natural logarithms are used in simulating A) binomial distribution B) negative exponential distribution C) normal distribution D) uniform distribution Question 3 Important benefits of simulation include A) handling of problems that cannot be solved analytically B) always finding the optimal solution C) relatively fast and cheap calculations D) evaluating and finding an exact solution for the problem at hand Question 4 If you are interested in predicting the time of day a road block may occur, you would use A) fixed interval simulation B) next event simulation C) deterministic simulation D) any one of A, B, or C can be used Question 5 Aspects of validation include A) test of reasonableness B) generating results similar to known systems C) checking assumptions and values of parameters used in the model D) all of the above

Discussion and Review Questions Question 1 Explain what is meant by the term operations research Operations research is the scientific approach to managerial decision making which involves the application of mathematical method to develop a model and then to develop a solution. The techniques have been applied successfully in many areas such as business, government, health care, education and bank. Operations research also referred to as quantitative analysis, quantitative method, management science and decision science.

Question 2 Suppose you have just been hired by a small firm. After being on the job for a few weeks, you realize that most problem solving is done on an informal basis; quantitative models are not being used. You share your reservations about this with your manager, and after a certain amount of discussion, your manager asks you to outline your reasoning on why the firm should adopt a more quantitative approach to problem solving. What would the main points of your response be? The first main point is quantitative approach can help a decision maker formulate problem. The second main point is the quantitative approach is easy to conduct and calculate by using computers and spreadsheet. The third main point is quantitative approach can save time and money in decision making and problem solving.

Question 3 Suppose that senior management has asked you to give a presentation that will enlighten them on the use of models for problem solving. Specifically, they want to know what a model is, what types of models there are, how models can lead to good solutions and any potential pitfalls to be aware of. Outline your presentation. Definition: Model is a representation (usually mathematical) of a situation. Types of model: 1. Schematic model a picture, drawing or chart of reality 2. Mathematical model a set of mathematical relationships 3. Physical model use by architect to make building that they construct 4. Scale model use by engineer to develop chemical plant Model can lead to good solutions by the following criteria: 1. The model should be developed carefully 2. The model should be solvable and realistic 3. The model should be easy to understand and modify 4. The model should contain at least one or more variable and parameters

Potential pitfalls to be aware of: 1. The data is not obtain 2. Not enough amount of detail

Question 4 You are faced with making a choice between two models. One is fairly simple model that will provide an approximate answer to the problem; the other is a much more complex model that can be expected to provide a much more precise answer to the problem. Under what circumstances would you choose the simple model? Simple model is use when all input variables are known and have constant value Under what circumstances would the more sophisticated model be your choice? Sophisticated model is use when at least one input variables in uncertain

Question 5 Briefly describe the operations research approach to problem solving. The first step is defining the problem. The problem must be clear and concisely defined. Improperly defining a problem can easily result in no solution or an inappropriate solution. The second step is developing a model. Model is a representation of a situation that may be iconic, analog and mathematical. Models contain variables and parameters. The third step is acquiring input data. Obtaining accurate data for the model is essential. Data may come from company reports, company documents and interviews. The fourth step is developing a solution. This involves in manipulating the model to arrive at the best solution to the problem. Solution must be practical and implementable. The fifth step is testing the solution. The solution depends on the input data and the model. The sixth step is analyzing the result. Analyzing the results starts with determining the implications of the solution. The seventh step is implementing the results. This is the process of incorporating the solution into the company.

Question 6 Contrast deterministic and probabilistic model, and indicate the conditions under which each type would be appropriate. Deterministic model do not involve risk and chance have constant value for example, the EOQ model in inventory control condition: when all input variables are known or certain Probabilistic model involve risk and chance the value are varies for example, simulation model using Monte Carlo Method condition: at least one input variables is uncertain

Question 7 Suppose that after a considerable amount of time and effort, the solution obtained from a model is not implemented. List some possible reason for this. 1. The solution have wrong objective 2. The solution obtained not accurate 3. The data is insufficient Would you say that the time and effort was, therefore probably wasted? Explain your answer The time and effort is not wasted. This is because time and effort do not affect the solution which will obtain from a model.

Question 8 What does the phase modeling can become an end in itself mean? Is this necessarily bad? The phase means that some of the model in operations research is too complex to handle. It is bad because we will not get the answer to the problem.

Question 9 Why might a solution that is optimal in a model not be optimal in reality? How might the gap be closed? What risks might there be in attempting to close the gap? A solution that is optimal in a model not be optimal in reality because a model can be measure by using assumptions which will produce different answer. The gap can be closed by choosing the model based on past occurrence. The risk that might happen in attempting to close the gap is when the past occurrence might not happen in the future. Question 10 How and why are computers an integral part of operations research? Computers are critical in stimulating complex tasks. They can generate random numbers, simulate thousands of time periods in a matter of seconds or minutes and provide management with reports that make decision making easier. By using POM-QM for windows and Excel QM through computers, this allows us to solve problems and complicated mathematical calculation.