This question paper consists of 07 questions and 05 printed page.

Jagannath International Management School, Kalkaji

(Please write your Roll No. immediately) Roll No. __________

End Term Examination

III-Trimester PGDM – April 2018
Twelfth Batch (2017-19)
Paper Code: G 305
Subject: Business Analytics and Consulting
Time: 3 Hours M. Marks: 60
Note: i) Q. No. 1 is compulsory and carries 20 marks. Attempt Q. No. 1 and any four questions from the
remaining which carry 10 marks each.
ii) All Sub-parts of the question should be answered together.

Section A (Any 5 parts out of 7 parts available) [5X4 = 20 Marks]

Q1. Please answer any 5 of the following questions

a. i. Market basket data is often represented in a binary format. Please explain how this is done
for a market basket of 2 transactions, milk and bread. [2 Marks]
ii. A supermarket stocks 100 items. How many k-itemsets can be created for the
supermarket? Please explain your answer . [2 Marks]
b. i. What is a stationary time series? Why is it useful in forecasting? [2 Marks]
ii. I have sales data for 12 months, which includes data on average sales for the 10 salesmen
in the company.
Given that the average sales in January is 950 units and standard deviation is 30, please
estimate the average sales in October and the standard deviation, assuming that the time
series data that you have is stationary. Please justify. [2 Marks]

c. i. What are the two kinds of stationarization possible? Please define each in 5 lines or less
[2 Marks]
ii. What is the difference between a naïve forecast and an n-period moving average forecast?
Can they be used for non-stationary data? Please justify. [2 Marks]

d. i. Specify the different kinds of nodes in a decision tree. [2 Marks]

ii. In a series of chess tournaments, Viswanathan Anand has played Fabiano Caruana in
classical, rapid and blitz chess tournaments and his record is as follows:
Total head-to-head record: Anand 12 – Caruana 8, Draw - 25
Classical chess: Anand6 – Caruana6, Draw - 12
Rapid Chess: Anand 5 – Caruana 1, Draw - 12
Blitz Chess: Anand 1 – Caruana 1, Draw - 1
What is the probability of a draw if Anand plays Caruana in the Grenke Rapid Chess
tournament? [2 Marks]

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This question paper consists of 07 questions and 05 printed page.

Jagannath International Management School, Kalkaji

e. i. Explain the concept of BIAS and MAD. [2 Marks]
ii. Assuming that the sales of salt in a shop over the last 6 months has been 120, 110, 120,
120, 110, and 120 kgs; and the forecasts were 117 kg in each month. How good was the
forecast? Please justify using the BIAS and MAD parameters. [2 Marks]
f. i. Explain the concept of MSE and MAPE. [2 Marks]
ii. Given that the value of MSE over 3 months has been dropping from 900 in Month 1 to 841
in Month 2 to 784 in Month 3; please estimate the value of standard error for the 3 months.
Also, please explain if the quality of forecast is improving or decreasing in quality or
remains same. Please justify in 3 lines or less. [2 Marks]
g. i. Explain correlation coefficient and coefficient of determination. [2 Marks]
ii. Explain the relationship between correlation coefficient and coefficient of determination.
Given that correlation coefficient between variables A and B is -0.75 and between A and C
is +0.70, what is the value of coefficient of determination in both cases? Which one A vs B
or A vs C is better? [2 Marks]

Section B (Any 4questions, 10 marks each) 40 Marks

Q2. Association Analysis
a. Consider the following list of transactions and answer the questions that follow.

Transaction Item Item Item Item

ID
1 Milk Bread Eggs
2 Bread Sugar
3 Bread Cereal
4 Milk Bread Sugar
5 Milk Cereal
6 Bread Cereal
7 Milk Cereal
8 Milk Bread Cereal Eggs
9 Milk Bread Cereal

i. List the items in the store for which market basket transactions have been created. [1 mark]
ii. Recast the transaction table in binary format. [2 marks]
iii. Assume A = Milk, B = Bread, C = Cereal, D = Sugar and E = Eggs;
Given the frequent itemset {A, B, E}, how many association rules are possible? List out all
possible association rules. [2 + 3 marks]
iv. Of the association rules above, how many rules have minsup = 2 and minconf = 50%?
[2 marks]
You can get 3 bonus marks if you identify the specific association rules satisfying the above
conditions and 2 more bonus marks to identify the specific association rules NOT satisfying the
above conditions.

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This question paper consists of 07 questions and 05 printed page.

Jagannath International Management School, Kalkaji

Q3. Concepts of Simple Forecasting
The Instant Paper Clip Office Supply Corporation has been documenting the value of sales for
the first 11 months of the year.

S No 1 2 3 4 5 6 7 8 9 10 11
Month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
Sales 120 100 110 90 80 60 130 100 110 90 120
(Rs K)

a. Assuming that demand follows a stationary time series, use the naïve method to compute the
monthly demand forecast.
Also compute the values of BIAS and MAD for the naïve forecast. Which value would you use
for estimating the quality of your forecast and why? [1 + 2 + 2 Marks]
b. Compute the demand forecast using a 2-month, 3-month, 4-month, 5-month and 6-month
moving average (MA). As before, assume that demand follows a stationary time series.
In each case, please mention the month from which your forecasting can commence. Please
justify your response in 3 lines or less. [5 Marks]

Q4. Advanced Forecasting

a. Given the following table for sales vs advertising, what technique would you use to estimate
the sales if no money is pumped into advertising in Month 6? Please justify in 5 lines or less.
You may assume that the intercept value is 75.868. [2 Marks]

Month Sales (Rs K) Advertising (Rs K)

Jan 125 30
Feb 145 35
Mar 155 40
Apr 163 46
May 170 53

b. Given that the coefficient of determination of the original data is 91.45% and your forecast
results in a new coefficient of determination of 88%, how would you rate the quality of your
forecast? Please justify in 5 lines or less. [3 Marks]
c. Please explain the concept of simple exponential smoothing. Describe the equation used and
the impact of . If =1, what would simple exponential smoothing become? [3 Marks]
d. I have identified 4 quarters for recruitment of fresh graduates in my company. The
seasonality index of each of Quarter 1 and 3 is 1.5, while the seasonality index of Quarter 2
is 0.8.
Given that the total annual recruitment should be 4000, how many people should be
recruited in each quarter? [2 Marks]

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 This question paper consists of 07 questions and 05 printed page.

Jagannath International Management School, Kalkaji

Q5 Decision Trees
Given the amount of drug taking in universities, the UGC has decided to implement a
mandatory testing policy on all students in Indian universities.

Assume 5% of all students are habitual drug offenders.

If a student is a drug user, probability of testing positive for drugs is 90%
If a student is not a drug user, the probability of testing negative for drugs is 98%

a. During the tests, a student tests positive for drugs in the standard tests. Based on the
above data, how confident are you that the athlete is a habitual drug offender? Please
explain in 5 lines or less. [3 Marks]
b. Another student suspected of being involved in drugs is tested and comes out clean.
However, you still have suspicions that the tests have failed to detect the drugs in
that student. How likely is it that such an event could occur? What steps would you
suggest to minimize the chance of these drug tests failing? [3 Marks]
c. Draw the decision tree for a student’s failure in a drug test and another for passing a drug
test. [2 marks]
d. Would you ask a student passing a drug test to repeat the test? Why or why not? Please
justify in 3 lines or less. [2 marks]

Q6.Logistic Regression
a. Under what circumstances should one use logistic regression? [2 marks]
b. What is binary logistic regression and when is it used? [2 marks]
c. The following table specifies the variables and indicates the likelihood of people evacuating
their homes as a consequence of Cyclone Vardah hitting Chennai and nearby coastal areas.

Variable B Exp(B) 1/Exp(B) Remarks

Low-lying -0.6677 0.5134 1.9479
homes
Education 0.0501 1.0514 0.9511
Duration of stay -0.0198 0.9804 1.0192
Native 1.5583 4.7508 0.2105
Language
Lack of support 0.9166 2.5008 0.3999

Please rank the variables in terms of their causing people to evacuate their homes. Put in a
one-line remark against each variable in the above table. [4 marks]
d. Draw a rough graph of the logistic regression function. How does it differ from the graph of
an ordinary regression function? [2 marks]

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This question paper consists of 07 questions and 05 printed page.

Jagannath International Management School, Kalkaji

Q7. Data Cleansing and Data Validation
a. What is the difference between an input message and an error alert message when you are
setting up data validation conditions in MS-Excel? [2 Marks]
b. One of the major problems that company ABC Inc is facing is that people are extremely
lax with their spelling of city names and languages. Thus, people use Tamizh and Tamiz
for the language Tamil, Delhi, Dilli, and Dehli interchangeably for the capital of India
and so on. How would you ensure that a single consistent spelling is used all through in
all files? [3 Marks]
c. How would you define data glitches? How can they impact data quality? [2 Marks]
d. Please explain the stages in the data quality continuum. Explain each stage in 3 lines or
less. [3Marks]

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