CH 1

A model is a/n
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Terms in this set (12)
A model is a/n
abstraction of reality AND idealized representation
Mathematical models usually contain
Variables
Constants
Assumptions
The benefits of model building include
focusing on small number of important details AND the need to quantify information
The risks of model building include
omitting non-quantitative information
Risks of model building include
omitting non-quantitative information
Probabilistic model would be appropriate to use if the
Data follows a range, but the average is known with high level of confidence AND Data distribution is known with high level of confidence
Two of the steps in the management science approach to problem solving are:
Model construction and interpret & analyze the solution
A one-machine shop producing bolts has a fixed cost of $2000.00 and a variable cost of $2.00 per bolt. The selling price is $6.00 per unit. The breakeven volume of production is
500
A one-machine shop producing bolts has a fixed cost of $2000.00 and a variable cost of $2.00 per bolt. The selling price is $6.00 per unit. The total revenue corresponding to the breakeven volume of production is
3000
All other things remaining the same, if the variable cost per unit increases by 10% then the breakeven volume of production will
cannot tell from the data
A one person automobile oil change in rural Mississippi has a fixed overhead of $900.00 per month. The variable cost per oil change $10.00. The price tag is $30.00 for one oil change. The break even number of oil changes per month is45A one person automobile oil change in rural Mississippi has a fixed overhead of $900.00 per month. The variable cost per oil change $10.00. The price tag is $30.00 for one oil change. If the owner/worker Joe Smith desires to have a contribution per month of $2100.00, the number of oil changes he should do per month is150