Академический Документы
Профессиональный Документы
Культура Документы
John
Loucks
St. Edward’s
University
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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CHAPTER 1: Introduction
Body of Knowledge
Problem Solving and Decision Making
Quantitative Analysis and Decision Making
Quantitative Analysis
Models of Cost, Revenue, and Profit
Quantitative Methods in Practice
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Body of Knowledge
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Problem Solving
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Quantitative Analysis and Decision Making
Decision-Making Process
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Quantitative Analysis and Decision Making
Qualitative Analysis
• based largely on the manager’s judgment and
experience
• includes the manager’s intuitive “feel” for the
problem
• is more of an art than a science
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Quantitative Analysis and Decision Making
Quantitative Analysis
• analyst will concentrate on the quantitative facts
or data associated with the problem
• analyst will develop mathematical expressions
that describe the objectives, constraints, and
other relationships that exist in the problem
• analyst will use one or more quantitative
methods to make a recommendation
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Quantitative Analysis and Decision Making
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Quantitative Analysis and Decision Making
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Model Development
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Model Development
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
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Mathematical Models
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
Uncontrollable Inputs
(Environmental Factors)
Controllable
Output
Inputs Mathematical
(Projected
(Decision Model
Results)
Variables)
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Mathematical Models
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Model Solution
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Model Solution
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Model Solution
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Model Testing and Validation
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Example: Iron Works, Inc.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Iron Works, Inc.
Mathematical Model
• The total monthly profit =
(profit per unit of product 1)
x (monthly production of product 1)
+ (profit per unit of product 2)
x (monthly production of product 2)
= p1x1 + p2x2
We want to maximize total monthly profit:
Max p1x1 + p2x2
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
27
Example: Iron Works, Inc.
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
28
Example: Iron Works, Inc.
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
29
Example: Iron Works, Inc.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Iron Works, Inc.
Question
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Iron Works, Inc.
Answer
Substituting, the model is:
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Iron Works, Inc.
Question
The optimal solution to the current model is x1 =
60 and x2 = 626 2/3. If the product were engines,
explain why this is not a true optimal solution for the
"real-life" problem.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Iron Works, Inc.
Answer
One cannot produce and sell 2/3 of an engine.
Thus the problem is further restricted by the fact that
both x1 and x2 must be integers. (They could remain
fractions if it is assumed these fractions are work in
progress to be completed the next month.)
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Iron Works, Inc.
Uncontrollable Inputs
$100 profit per unit Prod. 1
$200 profit per unit Prod. 2
2 lbs. steel per unit Prod. 1
3 lbs. Steel per unit Prod. 2
2000 lbs. steel allocated
60 units minimum Prod. 1
720 units maximum Prod. 2
0 units minimum Prod. 2
Max 100(60) + 200(626.67)
60 units Prod. 1 s.t. 2(60) + 3(626.67) < 2000 Profit = $131,333.33
626.67 units Prod. 2 60 > 60 Steel Used = 2000
Controllable Inputs 626.67 < 720 Output
626.67 > 0
Mathematical Model
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
35
Example: Ponderosa Development Corp.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
36
Example: Ponderosa Development Corp.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
37
Example: Ponderosa Development Corp.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
38
Example: Ponderosa Development Corp.
Question
Identify all costs and denote the marginal cost
and marginal revenue for each house.
Answer
The monthly salaries total $35,000 and monthly
office lease and supply costs total another $5,000.
This $40,000 is a monthly fixed cost.
The total cost of land, material, labor, and sales
commission per house, $105,000, is the marginal
cost for a house.
The selling price of $115,000 is the marginal
revenue per house.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
39
Example: Ponderosa Development Corp.
Question
Write the monthly cost function c (x), revenue
function r (x), and profit function p (x).
Answer
c (x) = variable cost + fixed cost = 105,000x + 40,000
r (x) = 115,000x
p (x) = r (x) - c (x) = 10,000x - 40,000
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Ponderosa Development Corp.
Question
What is the breakeven point for monthly sales
of the houses?
Answer
r (x ) = c (x )
115,000x = 105,000x + 40,000
Solving, x = 4.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Ponderosa Development Corp.
Question
What is the monthly profit if 12 houses per month are
built and sold?
Answer
p (12) = 10,000(12) - 40,000 = $80,000 monthly profit
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Ponderosa Development Corp.
1000 115,000x
800
600
400 Total Cost =
40,000 + 105,000x
200
Break-Even Point = 4 Houses
0
0 1 2 3 4 5 6 7 8 9 10
Number of Houses Sold (x)
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Using Excel for Breakeven Analysis
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
44
Example: Ponderosa Development Corp.
Formula Spreadsheet
A B
1 PROBLEM DATA
2 Fixed Cost $40,000
3 Variable Cost Per Unit $105,000
4 Selling Price Per Unit $115,000
5 MODEL
6 Sales Volume
7 Total Revenue =B4*B6
8 Total Cost =B2+B3*B6
9 Total Profit (Loss) =B7-B8
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
45
Example: Ponderosa Development Corp.
Question
What is the monthly profit if 12 houses are built
and sold per month?
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Ponderosa Development Corp.
Spreadsheet Solution
A B
1 PROBLEM DATA
2 Fixed Cost $40,000
3 Variable Cost Per Unit $105,000
4 Selling Price Per Unit $115,000
5 MODEL
6 Sales Volume 12
7 Total Revenue $1,380,000
8 Total Cost $1,300,000
9 Total Profit (Loss) $80,000
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Example: Ponderosa Development Corp.
Question
What is the breakeven point for monthly sales
of the houses?
Spreadsheet Solution:
• One way to determine the break-even point using a
spreadsheet is to use the Goal Seek tool.
• Microsoft Excel ‘s Goal Seek tool allows the user to
determine the value for an input cell that will cause
the output cell to equal some specified value.
• In our case, the goal is to set Total Profit to zero by
seeking an appropriate value for Sales Volume.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
48
Example: Ponderosa Development Corp.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
49
Example: Ponderosa Development Corp.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
50
Example: Ponderosa Development Corp.
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
51
Management Science Techniques
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
52
Management Science Techniques
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
53
Management Science Techniques
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
54
Management Science Techniques
© 2016 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted
in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
55
Management Science Techniques
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in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use.
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Methods Used Most Frequently
Linear programming
Integer programming
Network models (such as transportation and
transshipment models)
Simulation
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End of Chapter 1
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