OIS 3660- FINAL STUDY GUIDE (PT. 2)
EXAM QUESTIONS AND ANSWERS 2026
VERIFIED.
What does TIRP stand for? - ANS Transparency, Incentive compatibility, Robustness, and
Pinch-Point
Why does double marginalization lead to lower sales? - ANS When all parties in the supply
chain add a margin, the final price is higher, so fewer people are willing to buy the
product/service
What is the effect of double marginalization?
All other answers are correct
Higher customer price
Lower sales
Lower supply chain profits - ANS All of the above
In which supply chain is the retail price lower and sales be higher? - ANS In the integrated
supply chain
In these graphs, what does "q" stand for? - ANS The sales quantity
What is the Bullwhip effect? - ANS It describes how the variability in demand increases when
orders "move" "upstream" in a Supply Chain
@COPYRIGHT ALL RIGHTS RESERVED PAGE 1 OF 12
, Providing idiosyncratic discounts to your customers can lead to a phenomenon called "forward
buying". In the case of The Office, the customer Blue Cross will probably purchase a lot more
paper next time they order, since they got such a great (and unexpected) discount. This would
then force Dunder Mifflin to order more from their supplier etc., potentially even causing the
Bullwhip effect...
What is the best strategy to avoid forward buying? - ANS Offer Every Day Low Pricing
What's the difference between a trend and seasonality? - ANS A trend is a relatively steady
increase (or decrease) over time, seasonality is a pattern that repeats (e.g., every year or even
every week).
If we are dealing with a very unstable dataset, then which forecasting method will most likely
result in the best (i.e., lowest) MAD, MSE, MAPE? - ANS Last Value
A regression analysis shows that #Visits to an online store determines the number of sales quite
accurately (i.e., R2 = 85%), following this equation: Sales = 5,000 + 0.05*#Visits. If the number of
Visits for next month is forecasted to be 100,000, what will be the Sales? - ANS 10,000
Which is harder to determine, the cost of overage or the cost of underage? - ANS The cost of
underage
How is the setting of overbooking flights a Newsvendor setting? - ANS Because airlines weigh
the costs of overbooking versus empty seats
If the cost of overage is higher than the cost of underage, then you should... - ANS Order
fewer than the average expected demand
Pc is less than 50% (this can be seen by the shaded area which is less than half of the area under
the graph). Does this mean that the cost of overage or the cost of underage is higher? -
ANS The cost of overage is higher
@COPYRIGHT ALL RIGHTS RESERVED PAGE 2 OF 12
EXAM QUESTIONS AND ANSWERS 2026
VERIFIED.
What does TIRP stand for? - ANS Transparency, Incentive compatibility, Robustness, and
Pinch-Point
Why does double marginalization lead to lower sales? - ANS When all parties in the supply
chain add a margin, the final price is higher, so fewer people are willing to buy the
product/service
What is the effect of double marginalization?
All other answers are correct
Higher customer price
Lower sales
Lower supply chain profits - ANS All of the above
In which supply chain is the retail price lower and sales be higher? - ANS In the integrated
supply chain
In these graphs, what does "q" stand for? - ANS The sales quantity
What is the Bullwhip effect? - ANS It describes how the variability in demand increases when
orders "move" "upstream" in a Supply Chain
@COPYRIGHT ALL RIGHTS RESERVED PAGE 1 OF 12
, Providing idiosyncratic discounts to your customers can lead to a phenomenon called "forward
buying". In the case of The Office, the customer Blue Cross will probably purchase a lot more
paper next time they order, since they got such a great (and unexpected) discount. This would
then force Dunder Mifflin to order more from their supplier etc., potentially even causing the
Bullwhip effect...
What is the best strategy to avoid forward buying? - ANS Offer Every Day Low Pricing
What's the difference between a trend and seasonality? - ANS A trend is a relatively steady
increase (or decrease) over time, seasonality is a pattern that repeats (e.g., every year or even
every week).
If we are dealing with a very unstable dataset, then which forecasting method will most likely
result in the best (i.e., lowest) MAD, MSE, MAPE? - ANS Last Value
A regression analysis shows that #Visits to an online store determines the number of sales quite
accurately (i.e., R2 = 85%), following this equation: Sales = 5,000 + 0.05*#Visits. If the number of
Visits for next month is forecasted to be 100,000, what will be the Sales? - ANS 10,000
Which is harder to determine, the cost of overage or the cost of underage? - ANS The cost of
underage
How is the setting of overbooking flights a Newsvendor setting? - ANS Because airlines weigh
the costs of overbooking versus empty seats
If the cost of overage is higher than the cost of underage, then you should... - ANS Order
fewer than the average expected demand
Pc is less than 50% (this can be seen by the shaded area which is less than half of the area under
the graph). Does this mean that the cost of overage or the cost of underage is higher? -
ANS The cost of overage is higher
@COPYRIGHT ALL RIGHTS RESERVED PAGE 2 OF 12
