1 and 2 could be multiple answers

1. Which of the below are the three components to every decision?

	a.	When the decision must be made
	b.	The decision alternatives
	c.	The future states of the world
	d.	Who is making the decision
	e.	The payoffs of each decision alternative given the states of the world.

2. What parts of a decision are under the control of the decision maker?

	a.	Determining the alternatives
	b.	Extend the decision to the furthest into the future
	c.	Assign probabilities to each future state of the world.
	d.	Assign someone else to make the decision.
	e.	Specify assigned payoffs.

3. What adjustment must be made to a cost-benefit analysis in circumstances in which costs and/or benefits extend across many years? (For example, the costs are incurrd now, but the benefits are realized ten years into the future.)

	a.	No adjustment need be made.
	b.	The past predicts the future.
	c.	The concept of the time value of money to view all elements in the same (present) time frame.

4. PERT analysis allows managers a way to use estimated project times and slack to adjust for unexpected changes and/or delays in project activities.

True

False

5. The total project calendar time is the sum of the times of each activity on the critical path of the project plan.

True

False

6. What is the present value for the below seires of project cash flows, assuming a discount rate of 7.0%?

Current Year Cash Flow ($450,000)

CY + 1 Year $79,000

CY + 2 Year $125,000

CY + 3 Year $140,000

CY + 4 Year $135,000

CY + 5 Year $45,000

	a.	$102,991
	b.	$(17,631)
	c.	$22,991
	d.	($1,763)

7. All other things being equal, is the poject with the PV of the cash flows in problem 6 above atractive. True = Yes. False = No.

True

False

8. A "Run Chart" is used to illustrate patterns of data collected over time.

True

False