Business Analytics 2nd Global Edition James R. Evans - Solutions

Discover the comprehensive solutions to the challenging queries found in the textbook "Business Analytics 2nd Global Edition" by James R. Evans. Our online platform offers a detailed answers key, providing you with step-by-step answers for each problem. Access the complete solution manual and solutions PDF, featuring meticulously solved problems that cater to your academic needs. Whether you’re searching for chapter solutions, a test bank, or an instructor manual, our resources are designed to enhance your understanding. Enjoy the convenience of a free download, offering unparalleled support for your business analytics journey.

Generate a neural network model for classifying churn based on the other variables. Describe the topology of the model.
Refer to Exercise 7. Show that the adjusted weights result in a smaller prediction error.
Describe how neural networks function nonlinearly.
Generate a C4.5-type decision tree.
Generate a CART decision tree.
Discuss the benefits and drawbacks of a binary tree versus a bushier tree.
Using the ClassifyRisk data set with predictors age, marital status, and income, and target variable risk, find the k-nearest neighbor for Record #1, using k=2 and Minkowski (city-block) distance (Chapter 19).
Using the data in table 10.5, find the k-nearest neighbor for Record #10, using k=3.
The example in the text regarding using the k-nearest neighbor algorithm for estimation has the closest record, overwhelming the other records in influencing the estimation. Suggest two creative ways that we could use to dilute this strong influence of the closest record.
Refer to Exercise 4. Find the Euclidean distance between each pair of points. Using these points, verify that Euclidean distance is a true distance metric.
Refer to Exercise 3. Alter your data set so that the classification changes for different values of k.
Explain the concept and importance of analyzing risk in business decisions.
Use data tables to conduct simple Monte Carlo simulations.
Use Analytic Solver Platform to develop, implement, and analyze Monte Carlo simulation models.
Compute confidence intervals for the mean value of an output in a simulation model.
Construct and interpret sensitivity, overlay, trend, and box-whisker charts for a simulation model.
Explain the significance of the “flaw of averages.”
Conduct Monte Carlo simulation using historical data and resampling techniques.
Use fitted distributions to define uncertain variables in a simulation.
Define and use custom distributions in Monte Carlo simulations.
Correlate uncertain variables in a simulation model using Analytic Solver Platform.
For the market share model in Problem 5 of Chapter 11, suppose that the estimate of the percentage of new purchasers who will ultimately try the brand is uncertain and assumed to be normally distributed with a mean of 35% and a standard deviation of 4%. Use the NORM.INV function and a one-way data
For the garage-band model in Problem 7 of Chapter 11, suppose that the expected crowd is normally distributed with a mean of 3,000 and standard deviation of 200.Use the NORM.INV function and a one-way data table to conduct a Monte Carlo simulation with 25 trials to find the distribution of the
A professional football team is preparing its budget for the next year. One component of the budget is the revenue that they can expect from ticket sales.The home venue, Dylan Stadium, has five different seating zones with different prices. Key information is given below. The demands are all
For the new-product model in Problem 9 of Chapter 11, suppose that the first-year sales volume is normally distributed with a mean of 100,000 units and a standard deviation of 10,000. Use the NORM.INV function and a one-way data table to conduct a Monte Carlo simulation to find the distribution of
Financial analysts often use the following model to characterize changes in stock prices:Pt = P0e(m-0.5s2)t+sZ2t where P0 = current stock price Pt = price at time t m = mean (logarithmic) change of the stock price per unit time s = (logarithmic) standard deviation of price change Z = standard
Use Analytic Solver Platform to simulate the Outsourcing Decision Model under the assumptions that the production volume will be triangular with a minimum of 800, maximum of 1,700, and most likely value of 1,400, and that the unit supplier cost is normally distributed with a mean of $175 and a
For the Outsourcing Decision Model, suppose that the demand volume is lognormally distributed with a mean of 1,500 and standard deviation of 500.What is the distribution of the cost differences between manufacturing in-house and purchasing? What decision would you recommend? Define both the cost
Suppose that several variables in the model for the economic value of a customer in Example 11.1 in Chapter 11 are uncertain. Specifically, assume that the revenue per purchase is normal with a mean of$50 and standard deviation of $5 and the defection rate is uniform between 20% and 40%. Find the
For the profit model developed in Example 11.2 in Chapter 11 and the Excel model in Figure 11.4, suppose that the demand is triangular with a minimum of 35,000, maximum of 60,000 and most likely value of 50,000; fixed costs are normal with a mean of$400,000 and a standard deviation of $25,000; and
For the Moore Pharmaceuticals model, suppose that analysts have made the following assumptions:• R&D costs: Triangular($500, $700, $800) in millions of dollars• Clinical trials costs: Triangular($135, $150,$160) in millions of dollars• Market size: Normal(2000000, 250000)• Market share in
Cruz Wedding Photography (see Problem 15 in Chapter 11) believes that the average number of wedding bookings per year can be estimated by triangular distribution with a minimum of 10, maximum of 22, and most likely value of 15.One of the key variables in developing his business plan is the life he
Use the Newsvendor Model spreadsheet to set up and run a Monte Carlo simulation assuming that demand is Poisson with a mean of 45 but a minimum value of 40 (use the lower cutoff parameter in the distribution dialog to truncate the distribution and ensure that no values less that 40 are generated
Simulate the newsvendor model for the mini-mart situation described in Problem 12 of Chapter 11.Use the IntUniform distribution in Analytic Solver Platform to model the demand and find the distribution of profit for order quantities of 10, 15, 20, 25, and 30.
Using the profit model developed in Chapter 11, implement a financial simulation model for a new product proposal and determine a distribution of profits using the discrete distributions below for the unit cost, demand, and fixed costs. Price is fixed at $1,000.Unit costs are unknown and follow the
The manager of the extended-stay hotel in Problem 27 of Chapter 11 believes that the number of rooms rented during any given week has a triangular distribution with minimum 32, most likely 38, and maximum 50.The weekly price is $950 and weekly operating costs follow a normal distribution with mean
Develop a Monte Carlo simulation model for the garage-band in Problem 7 in Chapter 11 with the following assumptions. The expected crowd is normally distributed with mean of 3,000 and standard deviation 400 (truncate the distribution to have a minimum of 0). The average expenditure on concessions
Tanner Park (see Problem 14 in Chapter 11) is a small amusement park that provides a variety of rides and outdoor activities for children and teens. In a typical summer season, the number of adult tickets sold has a normal distribution with a mean of 20,000 and a standard deviation of 2,000. The
Lily’s Gourmet Ice Cream Shop offers a variety of gourmet ice cream and shakes. Although Lily’s competes with other ice cream shops and frozen yogurt stores, none of them offer gourmet ice creams with a wide variety of different flavors. The shop is also located in an upscale area and therefore
A plant manager is considering investing in a new$30,000 machine. Use of the new machine is expected to generate a cash flow of about $8,000 per year for each of the next 5 years. However, the cash flow is uncertain, and the manager estimates that the actual cash flow will be normally distributed
The Kelly Theater produces plays and musicals for a regional audience. For a typical performance, the theater sells at least 250 tickets and occasionally reaches its capacity of 600 seats. Most often, about 450 tickets are sold. The fixed cost for each performance is normal with a mean of $2,500
Develop a simulation model for a 3-year financial analysis of total profit based on the following data and information. Sales volume in the first year is estimated to be 100,000 units and is projected to grow at a rate that is normally distributed with a mean of 7% per year and a standard deviation
The Executive Committee of Reder Electric Vehicles(see Problem 16 in Chapter 11) is debating whether to replace its original model, the REV-Touring, with a new model, the REV-Sport, which would appeal to a younger audience. Whatever vehicle chosen will be produced for the next 4 years, after which
Develop and analyze a simulation model for Koehler Vision Associates (KVA) in Problem 13 of Chapter 11 with the following assumptions. Assume that the demand is uniform between 110 and 160 per week and that anywhere between 10% and 20% of prospective patients fail to show up or cancel their exam at
For the Hyde Park Surgery Center scenario described in Problem 33 in Chapter 11, suppose that the following assumptions are made. The number of patients served the first year is uniform between 1,300 and 1,700; the growth rate for subsequent years is triangular with parameters (5%, 8%, 9%), and the
The Schoch Museum (see Problem 17 in Chapter 11) is embarking on a 5-year fundraising campaign.As a nonprofit institution, the museum finds it challenging to acquire new donors as many donors do not contribute every year. Suppose that the museum has identified a pool of 8,000 potential donors. The
Review the retirement-planning situation described in Chapter 11 (Example 11.11). Modify the spreadsheet to include the assumptions that the annual salary increase is triangular with a minimum of 1%, most likely value of 3%, and maximum value of 5%, and that the annual investment return is
The retirement planning model described in Chapter 11 (Example 11.11) assumes that the data in rows 5–8 of the spreadsheet are the same for each year of the model. Modify the spreadsheet to allow the annual salary increases and return on investment to change independently each year and use the
Adam is 24 years old and has a 401(k) plan through his employer, a large financial institution. His company matches 50% of his contributions up to 6% of his salary. He currently contributes the maximum amount he can. In his 401(k), he has three funds.Investment A is a large-cap index fund, which
Refer back to the college admission director scenario(Problem 36 in Chapter 11). Develop a spreadsheet model and identify uncertain distributions that you believe would be appropriate to conduct a Monte Carlo simulation. Based on your model and simulation, make a recommendation on how many
J&G Bank receives a large number of credit-card applications each month, an average of 30,000 with a standard deviation of 4,000, normally distributed.Approximately 60% of them are approved, but this typically varies between 50% and 70%. Each customer charges a total of $2,000, normally
SPD Tax Service is a regional tax preparation firm that competes with such national chains as H&R Block. The company is considering expanding and needs a financial model to analyze the decision to open a new store. Key factors affecting this decision include the demographics of the proposed
Sturgill Manufacturing, Inc. needs to predict the numbers of machines and employees required to produce its planned production for the coming year.The plant runs three shifts continuously during the workweek, for a total of 120 hours of capacity per week. The shop efficiency (the percent of total
O’Brien Chemicals makes three types of products:industrial cleaning, chemical treatment, and some miscellaneous products. Each is sold in 55-gallon drums. The selling price and unit manufacturing cost are shown below:Manufacturing Product Type Selling Price/drum Cost/drum Industrial Cleaning
Find a 95% confidence interval for the mean amount of all Rebco’s bills. Do the same for each customer size separately.
You are unemployed, 21 years old, and searching for a job. Until you accept a job offer, the following situation occurs. At the beginning of each year, you receive a job offer. The annual salary associated with the job offer is equally likely to be any number between $20,000 and $100,000. You must
Find a 95% confidence interval for the mean total cost of all customer orders. Then do this separately for each of the four regions. Create side-by-side box plots of total cost for the four regions. Does the positive skewness in these box plots invalidate the confidence interval procedure used?
Find a 95% confidence interval for the mean number of days it takes Rebco’s customers (as a combined group) to pay their bills. Do the same for each customer size separately. Create a box plot for the variable Days, based on all 91 billings. Also, create side-by-side box plots for Days for the
Continuing the previous problem, analyze part b in Excel as follows. Start with hypothetical population mean GMAT scores for men and women, along with population standard deviations. Enter these at the top of a worksheet. You can make the two means as close as you like, but not identical. Simulate
Import data of interest into Excel from http://wonder.cdc.gov/, a Department of Health and Human Services site.
Import data of interest into Excel from http://www.dot.gov/, the official site of the U.S. Department of Transportation.
Import data of interest into Excel from http://www.ed.gov/, the official site of the U.S. Department of Education. For example, you ought to find some interesting data from the Education Statistics link toward the bottom of the page.
Import data of interest into Excel from http://www.usatoday.com/sports/sagarin.htm.
Create a pivot table from the Foodmart.cub file. Then for each month, quarter, and year, show the percentage of revenue in each of the product families. For example, you should find that 72.21% of all revenue in March 1997 was in the Food family. Make sure the months in your final pivot table are
Create a pivot table from the Foodmart.cub file. Then for each product family and each product department, find the percentage of line items (from the Fact Count measure) of Canada, Mexico, and the three regions of the USA. For example, you should find that 48.27% of all line items in the Alcoholic
Suppose a bill is considered late if it is paid after 20 days. In this case its “lateness” is the number of days over 20. For example, a bill paid 23 days after billing has a lateness of 3, whereas a bill paid 18 days after billing has a lateness of 0. Find a 95% confidence interval for the
Find a 95% confidence interval for the difference between the following means: the mean total order cost for West customers and the mean total order cost for Northeast customers. Do the same for the other combinations: West versus Midwest, West versus South, Northeast versus South, Northeast versus
In 1969 and again in 1970, a lottery was held to determine who would be drafted and sent to Vietnam in the following year. For each date of the year, a ball was put into an urn. For example, in the first lottery, January 1 was number 305 and February 14 was number 4. This means that a person born
Suppose you want to estimate the population mean of some quantity when the population consists of millions of members (such as the population of all U.S. households). How is it possible that you can obtain a fairly accurate estimate, using the sample mean of only about 1000 randomly selected
It can be shown that a sum of normally distributedrandom variables is also normally distributed. Doall functions of normal random variables lead tonormal random variables? Consider the following.SuperDrugs is a chain of drugstores with three similarsizestores in a given city. The sales in a given
In basketball, a player who is fouled in the act of shooting gets to shoot two free throws. Suppose we hear that one player is an “85% free throw shooter.” If this player is fouled 25 times in the act of shooting (maybe over a period of several games), find the distribution of occasions where
You have been told that the distribution of regular unleaded gasoline prices over all gas stations in Indiana is normally distributed with mean $3.25 and standard deviation $0.075, and you have been asked to find two dollar values such that 95% of all gas stations charge somewhere between these two
Suppose you have a large data set for some sport. Each row might correspond to a particular team (as in the file P03_57.xlsx on football outcomes, for example) or it might even correspond to a given play. Each row contains one or more measures of success as well as many pieces of data that could be
A supermarket transactions data set is likely to have “hierarchical” columns of data. For example, for the product sold, there might be columns like Product Family, Product Department, Product Category, and maybe even more. (See the file Supermarket Transactions.xlsx from Chapter 2 as an
The file P02_18.xlsx contains daily values of the S&P Index from 1970 to early 2012. It also contains percentage changes in the index from each day to the next.a. Create a new variable President that lists the U.S. presidents Nixon through Obama on each date. You can look up the presidents and
The file P03_18.xlsx contains the times in the Chicago marathon for the top runners each year (the top 10,000 in 2006 and the top 20,000 in 2007 and 2008).a. Merge the data in these three sheets into a single sheet named 2006–2008, and in the new sheet, create a variable Year that lists the
The file P02_43.xlsx contains U.S. Bureau of Labor Statistics data on the year-to-year percentage changes in the wages and salaries of workers in private industries, including both white-collar and blue-collar occupations.a. Create box plots to summarize these distributions of annual percentage
Define data mining and some common approaches used in data mining.
Explain how cluster analysis is used to explore and reduce data.
Apply cluster analysis techniques using XLMiner.
Explain the purpose of classification methods, how to measure classification performance, and the use of training and validation data.
Apply k-Nearest Neighbors, discriminant analysis, and logistic regression for classification using XLMiner.
Describe association rule mining and its use in market basket analysis.
Use XLMiner to develop association rules.
Use correlation analysis for cause-and-effect modeling?
For the Excel file Pharmaceuticals, normalize each column of the numerical data (i.e., compute a Z-score for each of the values) and then compute the Euclidean distances between the following pharmaceutical companies: ABT, CHTT and MRX.
For the four clusters identified in Example 10.6, find the average and standard deviations of each numerical variable for the schools in each cluster and compare them with the averages and standard deviations for the entire data set. Does the clustering show distinct differences among the clusters?
For the Colleges and Universities data, use XLMiner to find four clusters using each of the other clustering methods (see Figure 10.13); compare the results with Example 10.6.
Use the k-NN algorithm to classify the new data in the Excel file Mortgage Defaulters Additional using only credit score and value of loan as input variables.
For the PC Purchase Data, identify association rules with the following input parameters for the XLMiner association rules procedure:a. support = 3; confidence = 90,b. support = 7; confidence = 90,c. support = 3; confidence = 70,d. support = 7; confidence = 70, Compare your results with those in
The Excel file Cosmetics Data provides data on purchases of different cosmetic items at a large chain store. Develop a market basket analysis using the XLMiner association rules procedure with the input parameters support = 35 and confidence = 80.
Explain how to use simple mathematics and influence diagrams to help develop predictive analytic models.
Apply principles of spreadsheet engineering to designing and implementing spreadsheet models.
Use Excel features and spreadsheet engineering to ensure the quality of spreadsheet models.
Develop and implement analytic models for multipletime-period problems.
Describe the newsvendor problem and implement it on a spreadsheet.
Describe how overbooking decisions can be modeled on spreadsheets.
Explain how model validity can be assessed.
Perform what-if analysis on spreadsheet models.
Construct one- and two-way data tables.

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Business Analytics 2nd Global Edition James R. Evans - Solutions

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