QUANTITATIVE ANALYSIS FOR MANAGEMENT EXAM QUESTIONS WITH CORRECT ANSWERS LATEST
UPDATE 2026
Algorithm - Answers A set of logical and mathematical operations performed in a specific sequence.
Break-Even Point - Answers The quantity of sales that results in zero profit.
Business analytics - Answers A data-driven approach to decision making that allows companies to
make better decisions.
Descriptive analytics - Answers The study and consolidation of historical data to describe how a
company has performed in the past is performing now.
Deterministic model - Answers A model in which all values used in the model are known with
complete certainty.
Input data - Answers Data that are used in a model in arriving at the final solution
Mathematical model - Answers A model that uses mathematical equations and statement to
represent the relationship within the model
Model - Answers A representation of reality or of a real-life situation.
Parameter - Answers A measurable input quantity that is inherent in a problem
Predictive analytics - Answers The use of techniques to forecast how things will be in the future based
on patterns of past data
Prescriptive analytics - Answers The use of optimization methods to provide new and. Ether ways to
operator based on specific business objectives.
Probabilistic model - Answers A model in which all values used in the model are not known with
certainty but rather involve some chance or risk, often measured as a probability value.
Problem - Answers A statement, which should come from a manager, that indicates a problem to. E
solved or an objective or a goal to be reached.
Quantitative Analysis or management science - Answers A scientific approach that uses quantitative
techniques as a tool in decision making
Sensitivity analysis - Answers A process that involves determining how sensitive a solution is to
changes in the formulation of a problem
Variable - Answers A measurable quantity that is subject to change
Profit equation - Answers sX - f - vX
where:
s = selling point
f = fixed costs
ν = variable cost per unit
X = number of units sold
Break- Even Point Equation - Answers BEP =(f / (s - ν)
Adjusted r^2 - Answers A measure of the explanatory power of a regression model that takes into
consideration the number of independent variables in the model
Binary variable - Answers See dummy variable
Coefficient if correlation (r) - Answers A measure of the strength of the relationship between two
variables.
Coefficient of determination (r^2) - Answers The percentage of the variability in the dependent
variable (γ) that is explained by the regression equation
Collinearity - Answers A condition that exists when one independent variable is correlated with
another independent variable
Dependent variable - Answers The γ variable in a regression model. This is what is being predicted.
Dummy value - Answers A variable used to represent a qualitative factor or condition. Dummy
variables have values of 0 or 1. This is also called a binary variable or an indicator variable.
Error - Answers The difference between the actual value (γ) and the predictors value (Ŷ)
Explanatory variabke - Answers The independent variable in a regression equation
Independent variable - Answers The X variable in a regression equation. This is used to help predict
the dependent variable
Least squares - Answers A reference to the criterion used to select the regression line, to minimize the
squared distances between the estimated straight lines and the observed values.
Multicollineratiry - Answers A condition that exists when one independent variable is correlated with
other independent variables
Mean Squared Error (MSE) - Answers An estimate of the error variance
, Multiple Regression Model - Answers A regression model that has more than one independent
variable
Observed significance level - Answers Another name of p-value
p-Value - Answers a probability value that is used when testing a hypothesis. The hypothesis is
rejected when this is low
Predictor variable - Answers Another name of explanatory variable
Regression analysis - Answers A forecasting procedure that uses the least-squares approach on one or
more independent variables to develop a forecasting model
Residual - Answers Another term for error
Underlying linear model for simple linear regression equation - Answers Y = β0 +β1X + ℓ
Simple linear regression model computed from a sample equation - Answers Ŷ = β0 +β1X
Error in regression model - Answers ℓ = Y - Ŷ
Slope in the regression line - Answers b1 = Σ(X - x̄) (Y - ӯ)
Σ(X - x̄ )^2
The intercept in the regression line - Answers b0 = ӯ - b1x̄
Total sums of squares - Answers SST = Σ(Y - ӯ)^2
Sum of squares due to error - Answers SSE = Σℓ^2 = Σ(Y - Ŷ)^2
Sum of squares due to regression - Answers SSR = Σ(Y - Ŷ)^2
Coefficient of determination - Answers r = SSR = 1 - SSE
SST SST
Relationship among sum of squares in regression - Answers SST = SSR + SSE
Coefficient of correlation. This has the same sign as the slope - Answers r = ±√r^2
An estimate of the variance of the errors in regression, n is the sample size and k is the number of
independent variables - Answers s^2 = MSE = SSE
n-k-1
An estimate of the standard deviation of the errors. Also called the standard error of the estimate -
Answers s = √MSE
Mean square regression, k is the number of independent variables - Answers MSR = SSR
k
F statistic used to test significance of overall regression mdoel - Answers F = MSR
MSE
Underlying model for multiple regression model - Answers Y = β0 +β1X1 + β2X2+. . . + βkXk + ϵ
Multiple regression model computed from a sample - Answers Ŷ = b0 +b1X1 + b2X2+. . . + bkXk
Adjusted r^2 used in building multiple regression models - Answers r^2 = 1 - SSE / (n - k - 1)
SST / (n - 1)
Adaptive Smoothing - Answers The process of automatically monitoring and adjusting the smoothing
constants in an exponential smoothing model
Bias - Answers A technique for determining the accuracy of a forecasting model by measuring the
average error and its direction
Causal Models - Answers Models that forecast using the variables and factors in addition to time
Centered Moving Average - Answers An average of the values centered at a particular point in time.
This is used to compute seasonal indices when trend is present
Cyclical Component - Answers A component of a time series is a pattern in annual data that tends to
repeat every several years
Decision - Making Group - Answers A group of experts in a Delphi technique that has the
responsibility of making the forecast
Decomposition - Answers A forecasting model that decomposes a time series into its seasonal and
trend components
Delphi - Answers A judgmental forecasting technique that uses decision makers, staff personnel, and
respondents to determine a forecast
Depersonalized Data - Answers Time-series data in which each value has been divided by its seasonal
index to remove the effect of the seasonal component
Deviation - Answers A term used in forecasting for error
Error - Answers The difference between the actual value and the forecast value
Exponential smoothing - Answers A forecasting method that is a combination of the last forecast and
the last observed value
UPDATE 2026
Algorithm - Answers A set of logical and mathematical operations performed in a specific sequence.
Break-Even Point - Answers The quantity of sales that results in zero profit.
Business analytics - Answers A data-driven approach to decision making that allows companies to
make better decisions.
Descriptive analytics - Answers The study and consolidation of historical data to describe how a
company has performed in the past is performing now.
Deterministic model - Answers A model in which all values used in the model are known with
complete certainty.
Input data - Answers Data that are used in a model in arriving at the final solution
Mathematical model - Answers A model that uses mathematical equations and statement to
represent the relationship within the model
Model - Answers A representation of reality or of a real-life situation.
Parameter - Answers A measurable input quantity that is inherent in a problem
Predictive analytics - Answers The use of techniques to forecast how things will be in the future based
on patterns of past data
Prescriptive analytics - Answers The use of optimization methods to provide new and. Ether ways to
operator based on specific business objectives.
Probabilistic model - Answers A model in which all values used in the model are not known with
certainty but rather involve some chance or risk, often measured as a probability value.
Problem - Answers A statement, which should come from a manager, that indicates a problem to. E
solved or an objective or a goal to be reached.
Quantitative Analysis or management science - Answers A scientific approach that uses quantitative
techniques as a tool in decision making
Sensitivity analysis - Answers A process that involves determining how sensitive a solution is to
changes in the formulation of a problem
Variable - Answers A measurable quantity that is subject to change
Profit equation - Answers sX - f - vX
where:
s = selling point
f = fixed costs
ν = variable cost per unit
X = number of units sold
Break- Even Point Equation - Answers BEP =(f / (s - ν)
Adjusted r^2 - Answers A measure of the explanatory power of a regression model that takes into
consideration the number of independent variables in the model
Binary variable - Answers See dummy variable
Coefficient if correlation (r) - Answers A measure of the strength of the relationship between two
variables.
Coefficient of determination (r^2) - Answers The percentage of the variability in the dependent
variable (γ) that is explained by the regression equation
Collinearity - Answers A condition that exists when one independent variable is correlated with
another independent variable
Dependent variable - Answers The γ variable in a regression model. This is what is being predicted.
Dummy value - Answers A variable used to represent a qualitative factor or condition. Dummy
variables have values of 0 or 1. This is also called a binary variable or an indicator variable.
Error - Answers The difference between the actual value (γ) and the predictors value (Ŷ)
Explanatory variabke - Answers The independent variable in a regression equation
Independent variable - Answers The X variable in a regression equation. This is used to help predict
the dependent variable
Least squares - Answers A reference to the criterion used to select the regression line, to minimize the
squared distances between the estimated straight lines and the observed values.
Multicollineratiry - Answers A condition that exists when one independent variable is correlated with
other independent variables
Mean Squared Error (MSE) - Answers An estimate of the error variance
, Multiple Regression Model - Answers A regression model that has more than one independent
variable
Observed significance level - Answers Another name of p-value
p-Value - Answers a probability value that is used when testing a hypothesis. The hypothesis is
rejected when this is low
Predictor variable - Answers Another name of explanatory variable
Regression analysis - Answers A forecasting procedure that uses the least-squares approach on one or
more independent variables to develop a forecasting model
Residual - Answers Another term for error
Underlying linear model for simple linear regression equation - Answers Y = β0 +β1X + ℓ
Simple linear regression model computed from a sample equation - Answers Ŷ = β0 +β1X
Error in regression model - Answers ℓ = Y - Ŷ
Slope in the regression line - Answers b1 = Σ(X - x̄) (Y - ӯ)
Σ(X - x̄ )^2
The intercept in the regression line - Answers b0 = ӯ - b1x̄
Total sums of squares - Answers SST = Σ(Y - ӯ)^2
Sum of squares due to error - Answers SSE = Σℓ^2 = Σ(Y - Ŷ)^2
Sum of squares due to regression - Answers SSR = Σ(Y - Ŷ)^2
Coefficient of determination - Answers r = SSR = 1 - SSE
SST SST
Relationship among sum of squares in regression - Answers SST = SSR + SSE
Coefficient of correlation. This has the same sign as the slope - Answers r = ±√r^2
An estimate of the variance of the errors in regression, n is the sample size and k is the number of
independent variables - Answers s^2 = MSE = SSE
n-k-1
An estimate of the standard deviation of the errors. Also called the standard error of the estimate -
Answers s = √MSE
Mean square regression, k is the number of independent variables - Answers MSR = SSR
k
F statistic used to test significance of overall regression mdoel - Answers F = MSR
MSE
Underlying model for multiple regression model - Answers Y = β0 +β1X1 + β2X2+. . . + βkXk + ϵ
Multiple regression model computed from a sample - Answers Ŷ = b0 +b1X1 + b2X2+. . . + bkXk
Adjusted r^2 used in building multiple regression models - Answers r^2 = 1 - SSE / (n - k - 1)
SST / (n - 1)
Adaptive Smoothing - Answers The process of automatically monitoring and adjusting the smoothing
constants in an exponential smoothing model
Bias - Answers A technique for determining the accuracy of a forecasting model by measuring the
average error and its direction
Causal Models - Answers Models that forecast using the variables and factors in addition to time
Centered Moving Average - Answers An average of the values centered at a particular point in time.
This is used to compute seasonal indices when trend is present
Cyclical Component - Answers A component of a time series is a pattern in annual data that tends to
repeat every several years
Decision - Making Group - Answers A group of experts in a Delphi technique that has the
responsibility of making the forecast
Decomposition - Answers A forecasting model that decomposes a time series into its seasonal and
trend components
Delphi - Answers A judgmental forecasting technique that uses decision makers, staff personnel, and
respondents to determine a forecast
Depersonalized Data - Answers Time-series data in which each value has been divided by its seasonal
index to remove the effect of the seasonal component
Deviation - Answers A term used in forecasting for error
Error - Answers The difference between the actual value and the forecast value
Exponential smoothing - Answers A forecasting method that is a combination of the last forecast and
the last observed value
