QUANTITATIVE TECHNIQUES FOR

MANAGERS
2020 MIDTERM EXAM
ASSIGNMENT
SOHONEY Yvan Cedrick cedricksohoney@gmail.com

GSM MBA 1 (2020) +225 65 24 48 84

Exercise 1

TR= 400Q - 4Q 2

TC= Q + 10Q + 30
2

1. Let’s determine the quantity which maximize the profit

The profit is maximized when the marginal cost is equal to the marginal revenue.
MC= 2Q + 10
MR= 400 - 8Q

MC = MR ⇔ 2Q + 10 = 400 - 8Q
⇔ 2Q + 8Q = 400 - 10
⇔ Q = 39

The quantity which maximize the profit is 39. Therefore, the firm should sell 39 units.

2. Let’s find the price

We know that : Total Revenue = P x Q

Therefore, TR= P x Q ⇔ P = TR/Q
Then, P= (400 (39) - 4 (1521) / 39

P= $244/unit

3. Let’s calculate the profit

π = TR - TC
= (400 (39) - 4 (39) ) - ((32 ) + 10 (39) + 30)
2 2

π = 7575

The amount of profit will be $7575

Exercise 2

Let’s say R = Retention and P = Process improvement

We have: P(R) = 0.56 ; P(P⋂R) = 0.56 and P(R⋂P) = 0.90

a. Let’s find the probability that the company uses training for employees retention and not for
process improvement.

P(R⋂NP) = P(R) - P(P⋂R)

= 0.56 - 0.36
P (R⋂NP) = 0.20

Therefore, the probability that the company uses training for employees retention and not for
progress improvement is 20%.

b. Let’s find the probability that company uses training for process improvement if it is known
that the company uses training for employees.

P(P/ R) = P(P⋂R) / P(R)

=0.36 / 0.56
P(P/R) = 0.6429

Therefore, the probability of this event is 64.29%.

c. Let’s find the probability that the company uses training for process improvement.

We know that P(P) = P(R⋂P) / P(P/R)

= 0.36 / 0.90
P(P) = 0.40

Therefore, the probability of this event is 40%.

d. Let’s find the probability if the company uses training for retention or process improvement.

P(R∪P) = P(R) + P(P) - P(R∩P)

= 0.56+0.40-0.36
P(R∪P) = 0.6

Therefore, the probability of this event is 60%.

e. Probability that the company neither uses training for retention nor for process improvement.

P(NR∪NP) = 1 - P(R∪P)
= 1 - 0.60
P(NR∪NP) = 0.4

Therefore, the probability of this event is 40%.

f. Let’s find the probability that the company does use training for employee retention
supposing it doesn’t use training for process improvement.

P(R/NP) = P(R∩NP) / P(NP)

But, P(NP) = 1- P(P)

 = 1 - 0.40
P(NP) = 0.60
Therefore, P(R/NP) = 0.20/0.60
P(R/NP) = 0.3333

Therefore, the probability of this event is 33.33%.

Exercise 3

Let’s say that the Coefficient of variation is known as CV and the standard deviation as SD.
Coefficient of variation will be: CV = (SD / Mean) x 100

a. Let’s determine the stock X variability

We do have: SD= 3.42 and mean =32

Therefore, CV= (3.42/32) x 100
CV= 10.78%

b. Let’s find the stock Y variability

We do have, SD = 5.4 and mean = 84.

Therefore, CV = (5.4/84) x 100
CV = 6.43%

Exercise 4

A. We know that

Probability of an item produced by machine A is P(A) =0.1

Probability of an item produced by machine B is P(B) = 0.4
Probability of an item produced by machine C is P(C) = 0.5

On the basic information, probability of an item produced by a machine being defective is:
P(D/A) = 0.05
P(D/B) = 0.12
P(D/C) = 0.08

Given the item is defective, probability of being produced by C :

P(C/D) = [P(C) x P(D/C)] / [P(A) x P(D/A)] + [P(B) x P(D/B)]+ [ P(C) x P(D/C) ]

P(C/D) = 0.43

Therefore, the probability that the item was produced by machine C is 43%.

B. Let’s say that:

P(A) = 0.46
P(B) = 0.37
P(A∩B) = 0.12
P(A’) = 0.54
P(B’) = 0.63

a- Let’s determine the probability that the owner believes that the economy is a challenge for growth
if the owner believes that finding qualified workers is a challenge for growth

P(A/B) = P(A∩B) / P(B) = = 0.12 / 0.37 = 0.3243

Therefore, the probability of this event is 32.43%

b- Let’s determine the probability that the owner believes that finding qualified workers is a challenge
for growth if the owner believes that the economy is a challenge for growth

P(B/A) = P(A∩B) / P(A) = 0 .12 / 0.46 = 0.2609

Therefore, the probability of this event is 26.09%

c- Let’s determine the probability that the owner believes neither that the economy is a challenge for
growth nor that finding qualified workers is a challenge for growth

P(B/A’) = P(A’∩B) / P(A’) = P(A) - P(A∩B) / P(A’) = (0.46 - 0.12) / 0.54 = 0.6296

Therefore, the probability of this event is 62.96%

d- Let’s determine the probability that the owner believes that the economy is a challenge for growth
or that finding qualified workers is a challenge for growth but not both

P(A’∩B’) = 1 - [P(A) + P(B) - P(A∩B)] = 1- (0.46 + 0.37 - 0.12) = 0.29

Therefore, the probability of this event is 29%