MSIS 3223 EXAM QUESTIONS WITH CORRECT ANSWERS
LATEST UPDATE
Formulas in Excel use common mathematical operators:
Addition +
• Subtraction -
• Multiplication *
• Division /
• Raised to the Power of (Exponentiation) ^
Relative Address
A relative address uses just the rowand column label in the cell reference (for example
A4 or C23)
Absolute Address
An absolute address uses a dollars sign ($) before either the row orcolumn or both (for
example $A2, C$23, or $B$15)
How Absolute Address Works:
Using a dollar sign ($) before a row label (for example B$4) keeps thereference fixed to
row 4 but allows the column reference to change ifthe formula is copied to another cell.
A dollar sign before both therow and column (for example $B$4) will keep the reference
fixed forboth the row and column.
Easiest way to locate a particular function
INSERT Function button (fx)
Common Excel Functions
• MIN(range) finds the smallest value in a range of cells
• MAX(range) finds the largest value in a range of cells
• SUM(range) finds the sum of values in a range of cells
• AVERAGE(range) finds the average of the values in a range of cells
• COUNT(range) finds the number of cells in a range that contains numbers
• COUNTIF(range, criteria) finds the number of cells within a range that meet aspecified
criterion
Net Present Value (NPV)
measures the worth of a stream of cashflows, taking into account the time value of
money.
The Discount Rate
The discount rate reflects the opportunity costs of spending fundsnow versus achieving
a return through another investment, as well asthe risks associated with not receiving
returns until a later time.
Positive NPV
the investment will provide added valuebecause the projected return exceeds the
discount rate.
Descriptive Analytics
most commonly used and most-wellunderstood type of analytics. Descriptive analytics
summarizes datainto meaningful charts and reports, for example, about budgets,sales,
revenues, or cost
, Perdictive Analytics
seeks to predict the future by examining historicaldata, detecting patterns or
relationships in these data, and thenextrapolating these relationships forward in time.
Prescriptive Analytics
uses optimization to identify the bestalternatives to minimize or maximize some
objective
Data used in business decisions need to be -
reliable and valid
Reliability
data are accurate and consistent
Validity
data measure what they are supposed to measure.
Model
an abstraction or representation of a real system, idea, orobject. Models capture the
most important feature of a problem andpresent them in a form that is easy to interpret
can be as simple as a written or verbal description of somephenomenon, a visual
representation (visual model) such as a graphor flowchart, or a mathematical or
spreadsheet representation.
Decision Models - types of inputs
• Data, which are assumed to be constant for purposes of the model.
• Uncontrollable inputs, which are quantities that can change but cannot bedirectly
controlled by the decision maker.
• Decision options, which are controllable and can be selected at the discretionof the
decision maker. Decision options are often called decision variables.
Descriptive models -
Explain behavior and allow users to evaluatepotential decisions by asking "what-if
questions. Descriptive decision models describe relationships allowing a manager to
make adecision, without telling a manager what to do.
predictive models -
focus on what will happen in the future
perscriptive models
help decision makers identify the best solution todecision problems. Prescriptive models
use optimization—the process of finding a set of values for decision options that
minimize ormaximize some quantity of interest.
Phases in Problem Solving -
1. Recognizing the problem--a problem exists when there is a gap betweenwhat is
happening and what we think should be happening.
2. Defining the problem--In defining problems, it is important to involve all peoplewho
make the decisions or who may be affected by them.
3. Structuring the problem--a formal model is often developed in this phase.
4. Analyzing the problem--experimentation or solution process, evaluating
differentscenarios, or analyzing risks associated with various decision alternatives.
5. Interpreting results and making a decision--models cannot capture every detail ofthe
real problem, and managers must understand the limitations.
6. Implementing the solution--making the solution work in the organization ortranslating
the results back to the real world.
LATEST UPDATE
Formulas in Excel use common mathematical operators:
Addition +
• Subtraction -
• Multiplication *
• Division /
• Raised to the Power of (Exponentiation) ^
Relative Address
A relative address uses just the rowand column label in the cell reference (for example
A4 or C23)
Absolute Address
An absolute address uses a dollars sign ($) before either the row orcolumn or both (for
example $A2, C$23, or $B$15)
How Absolute Address Works:
Using a dollar sign ($) before a row label (for example B$4) keeps thereference fixed to
row 4 but allows the column reference to change ifthe formula is copied to another cell.
A dollar sign before both therow and column (for example $B$4) will keep the reference
fixed forboth the row and column.
Easiest way to locate a particular function
INSERT Function button (fx)
Common Excel Functions
• MIN(range) finds the smallest value in a range of cells
• MAX(range) finds the largest value in a range of cells
• SUM(range) finds the sum of values in a range of cells
• AVERAGE(range) finds the average of the values in a range of cells
• COUNT(range) finds the number of cells in a range that contains numbers
• COUNTIF(range, criteria) finds the number of cells within a range that meet aspecified
criterion
Net Present Value (NPV)
measures the worth of a stream of cashflows, taking into account the time value of
money.
The Discount Rate
The discount rate reflects the opportunity costs of spending fundsnow versus achieving
a return through another investment, as well asthe risks associated with not receiving
returns until a later time.
Positive NPV
the investment will provide added valuebecause the projected return exceeds the
discount rate.
Descriptive Analytics
most commonly used and most-wellunderstood type of analytics. Descriptive analytics
summarizes datainto meaningful charts and reports, for example, about budgets,sales,
revenues, or cost
, Perdictive Analytics
seeks to predict the future by examining historicaldata, detecting patterns or
relationships in these data, and thenextrapolating these relationships forward in time.
Prescriptive Analytics
uses optimization to identify the bestalternatives to minimize or maximize some
objective
Data used in business decisions need to be -
reliable and valid
Reliability
data are accurate and consistent
Validity
data measure what they are supposed to measure.
Model
an abstraction or representation of a real system, idea, orobject. Models capture the
most important feature of a problem andpresent them in a form that is easy to interpret
can be as simple as a written or verbal description of somephenomenon, a visual
representation (visual model) such as a graphor flowchart, or a mathematical or
spreadsheet representation.
Decision Models - types of inputs
• Data, which are assumed to be constant for purposes of the model.
• Uncontrollable inputs, which are quantities that can change but cannot bedirectly
controlled by the decision maker.
• Decision options, which are controllable and can be selected at the discretionof the
decision maker. Decision options are often called decision variables.
Descriptive models -
Explain behavior and allow users to evaluatepotential decisions by asking "what-if
questions. Descriptive decision models describe relationships allowing a manager to
make adecision, without telling a manager what to do.
predictive models -
focus on what will happen in the future
perscriptive models
help decision makers identify the best solution todecision problems. Prescriptive models
use optimization—the process of finding a set of values for decision options that
minimize ormaximize some quantity of interest.
Phases in Problem Solving -
1. Recognizing the problem--a problem exists when there is a gap betweenwhat is
happening and what we think should be happening.
2. Defining the problem--In defining problems, it is important to involve all peoplewho
make the decisions or who may be affected by them.
3. Structuring the problem--a formal model is often developed in this phase.
4. Analyzing the problem--experimentation or solution process, evaluating
differentscenarios, or analyzing risks associated with various decision alternatives.
5. Interpreting results and making a decision--models cannot capture every detail ofthe
real problem, and managers must understand the limitations.
6. Implementing the solution--making the solution work in the organization ortranslating
the results back to the real world.
