Questions from Management Science

Q: In the product mix model it makes sense to change the maximum

In the product mix model it makes sense to change the maximum sales constraint to a “minimum sales” constraint, simply by changing the direction of the inequality Then the input values in row 23 can b...

Q: The fixed costs are split $4 million for development and $

The fixed costs are split $4 million for development and $2 million for marketing. Perform a sensitivity analysis where the sum of these two fixed costs remains at $6 million but the split changes. Sp...

Q: Use a two-way PrecisionTree sensitivity analysis to examine the changes

Use a two-way PrecisionTree sensitivity analysis to examine the changes in both of the two previous problems simultaneously. Let the probability of technological success vary from 0.6 to 0.9 in increm...

Q: In the file Bayes Rule for Disease.xlsx, explain why

In the file Bayes Rule for Disease.xlsx, explain why the probabilities in cells B9 and B10 (or those in cells C9 and C10) do not necessarily sum to 1, but why the probabilities in cells B9 and C9 (or...

Q: In using Bayes’ rule for the presence of a disease, we

In using Bayes’ rule for the presence of a disease, we assumed that there are only two test results, positive or negative. Suppose there is another possible test result, “maybe.” The 2 * 2 range B9:C1...

Q: The finished version of the file for Example contains two “Strategy

The finished version of the file for Example contains two “Strategy B9” sheets. Explain what each of them indicates and how they differ.

Q: Starting with the finished version of the file for Example, change

Starting with the finished version of the file for Example, change the fixed cost in cell B5 to $4000. Then get back into PrecisionTree’s One-Way Sensitivity Analysis dialog box and add three more inp...

Q: Starting with the finished version of the file, change the fixed

Starting with the finished version of the file, change the fixed cost in cell B5 to $4000. Change the probabilities in cells B9 (make it smaller), B14 (make it larger), and B15 (make it smaller) in so...

Q: Suppose you are tested to see if you have a rare disease

Suppose you are tested to see if you have a rare disease. Assume that if you have the disease, your test will always come back positive, but if you do not have the disease, there is still a 0.001 chan...

Q: For the decision problem in Figure 9.1, use data

For the decision problem in Figure 9.1, use data tables to perform the following sensitivity analyses. The goal in each is to see whether decision 1 continues to have the largest EMV. In each part, pr...