MGMT402: Data & Decisions

Fall 2020 – FEMBA Section 1 (Saturday afternoon)

Instructor: Professor Velibor Misic
Office: Gold Hall, Room B406
Email: velibor.misic@anderson.ucla.edu

Teaching Assistant: Xinyi Guan

Email: xinyi.guan.phd@anderson.ucla.edu

Class Sessions: Saturdays, 2:00pm to 5:15pm

Via Zoom

Overview
Business decisions are made with partial information and in an uncertain environment. The
objectives of this course are: (a) to introduce data analyses for generating information useful
in decision making and (b) to provide a framework for analyzing decisions based on partial
information. To achieve these objectives, we will develop a foundation of probability and
statistics, which is also necessary for subsequent courses and for a management career.
The course is organized into three areas:
1. Probability theory: basics of probability, joint and conditional probability, Bayes
rule, discrete random variables, continuous random variables, sums of random vari-
ables, binomial and normal distributions, expected value, variance.
2. Statistics: descriptive statistics, sampling distributions, hypothesis testing, interval
estimation, statistical inference, simple and multiple regression, predictions.

3. Decision Analysis: problem framing, quantifying uncertainty, evaluation using ex-

pected monetary value, value of information.

Course Materials, Assessment and Rules

Grading
Your course grade will be determined as follows:

Class Participation 10%

Homework 25%
Quizzes 25%
Final Exam 40%

We will use the following grading curve:

Grade Frequency
A+/A/A- No more than 50%
B+ or lower At least 50%

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Class Attendance and Etiquette
Attendance in class is required. We will follow standard FEMBA core course attendance
policy, which operates as follows. You are allowed to miss two classes without penalty. For
each class missed beyond the two classes, your final grade in the course will be reduced by
one letter grade. As an example, if you would have completed the course with an A-, but
you ended up missing three classes, you will receive a B- in the course.
Besides attendance, I expect you to come to class on time, not to arrive late and to stay
for the entirety of the class. Be engaged and do your best to follow in class and outside
of class by doing the homework and attempting the practice problems. Please have your
microphone muted, and only unmute it when I instruct you that it is OK to do so.

Homework
We will have five homework assignments. Each homework will consist of up to 5 to 6
questions that are intended to help with understanding the class material and giving you
practice in using the quantitative techniques from class.
Each homework assignment will be worth 5% of the overall 25% homework component
of the grade. Each homework assignment will be due by the start of class, via CCLE. Late
homework submissions will not be accepted.
Each homework assignment will be graded out of 5 points. Homework grading will be
based on making a reasonable attempt at each of the homework problems. If you make a
reasonable attempt at each problem that is assigned on the homework, you will receive full
marks (5 points out of 5), even if your final answers are wrong. The homework is structured
in this way to provide you with a low-pressure means of trying the concepts on your own.
In addition, some homework assignments will include questions that introduce a case that
we will discuss in more depth in lecture later on.
You are allowed to discuss the problems with others, but the assignment that you
submit must be your own. Copying somebody else’s answers is a violation of
academic integrity and will result in disciplinary action.

Quizzes
There will be three quizzes, which will be administered through CCLE. Each quiz can be
taken in the following time period:

1. Quiz 1: 12pm PST October 11 - 12pm PST October 14.

2. Quiz 2: 12pm PST October 25 - 12pm PST October 28.
3. Quiz 3: 12pm PST November 8 - 12pm PST November 11.

You may take each quiz at any time in the designated time period. Once you start the
quiz, you will have 2 hours to complete the quiz. Your quiz must be submitted by the end
time provided above. (For example, Quiz 2 must be submitted by 12pm PST on October
28.) Please plan ahead and make sure that you give yourself enough time to work on each
quiz. For example, do not start Quiz 2 at 11:30am on October 28, as the submission page
will close at 12pm on October 28, and you will therefore effectively only have 30 minutes to
submit your quiz! Late submissions will not be accepted.
A complete submission consists of (1) your final answers to each of the problems (the
quiz page will provide allow you to input your answers) and (2) a file submission of your
work for each of the problems. The submission of your work can be a scanned PDF of
your handwritten solutions, which can be obtained using a scanner if you have one, or

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a smartphone app such as CamScanner (https://www.camscanner.com). Alternatively,
your work can also be written on the computer, using Microsoft Word or Latex, or using
a tablet, such as an iPad and an Apple Pencil. Please note that answers that are
unaccompanied with work will not receive any credit.
Each quiz is an open book, open notes test. You may use any of the class material on
CCLE or from the recommended textbook. You may use a simple scientific calculator or
your computer to do calculations. You must complete each quiz on your own. Com-
munication with anyone regarding the quiz who is not the TA or the instructor
is not allowed. Any unauthorized communication or collaboration is a violation
of academic integrity and will result in disciplinary action.
Quiz 1 will be a “mock” quiz and account for 5% of the overall 25% quiz component
of the grade. The quiz will contain real questions, but we will not grade your solution
for correctness: as long as you make a submission (consisting of both your answers to the
questions and your work), you will receive the 5%. The purpose of this quiz is for you
to familiarize yourself with the submission interface and to also get practice with solving
problems under a time constraint. The TA and I will also use this to identify and iron out
any technical issues that may arise from administering the quiz through CCLE.
Quiz 2 and Quiz 3 will be “real” quizzes, in that your answers to the quiz will be graded
fully. Quiz 2 and Quiz 3 will each account for 10% out of the 25% quiz component.

Final Exam
The final exam will be administered through CCLE. The final exam can be taken in the
following time period:

1. Final Exam: 12pm December 10 – 11:59pm PST December 12

You may take the final exam at any time in the designated time period. Once you start
the exam, you will have 4 hours to complete the exam. Your exam must be submitted by
the end time provided above. As with the quizzes, please plan ahead and make sure that
you give yourself enough time to work on the final. For example, do not start the final exam
at 11pm on December 12 as you will only have 59 minutes to complete your final exam.
Late submissions will not be accepted.
As with the quizzes, a complete submission consists of (1) your final answers to each of
the problems (the exam page will provide boxes in which to input your answers) and (2) a
file submission of your work for each of the problems.
The final exam is an open book, open notes test. You may use any of the class material on
CCLE or from the textbook. You may use a simple scientific calculator or your computer to
do calculations. You must complete the final exam on your own. Communication
with anyone regarding the quiz who is not the TA or the instructor is not
allowed. Any unauthorized communication or collaboration is a violation of
academic integrity and will result in disciplinary action.

Textbook
The assigned readings for the course will come from the following textbook:
• Statistics for Business & Economics, 13th edition, by Anderson, Sweeney, Williams
et al.
– Amazon link:
https://www.amazon.com/Statistics-Business-Economics-Revised-Education/dp/1337094161/

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 – Hardcover: ∼$104 at Amazon; ∼$120 at http://www.cengagebrain.com/
– Rental: ∼ $15 at Amazon
– 11th or 12th edition is also acceptable; there is also a new 14th edition, which is
also acceptable, but earlier editions may be cheaper.

In addition, you may find the following book useful:

• The Cartoon Guide to Statistics by Gonick and Smith
– This (optional) book is relatively easy to read and discusses about half of the
course material.

Software
In the last 3-4 lectures, we will be studying linear regression. For these lectures, we will be
using RegressIt (http://www.regressit.com). RegressIt is a free Microsoft Excel add-in
that will allow us to do regression, and is compatible with both Windows and Mac. We will
post instructions on how to get set up with RegressIt later in the quarter.

Review Session
The TA will hold an optional review session to discuss additional examples, as well as to
answer any questions you might have about the material. The review session will tentatively
be held every Friday from 7:00pm to 8:00pm via Zoom, starting in Week 2 on October 2.

Course Reader
Most of the course materials (problem sets, cases, notes, probability tables, etc.) are avail-
able on the course website. However, there are three copyrighted cases (Browser Wars,
Freemark Abbey and A/B Testing at Vungle) that are not available on the course website.
These are available as a course reader that can be purchased at the following link:
• https://ucla.redshelf.com/book/1626161

Practice Problems
A set of practice problems will be posted on the course website. These problems are not to
be handed in, but please attempt them. We will provide answers to the problems during
the quarter.

Regrading
If you believe that a quiz was not graded properly, please contact the professor and ask
for a regrade. Clerical errors such as addition mistakes will be corrected without any risk.
All other regrade requests will involve a complete re-grade of all questions. Students who
request a regrade acknowledge that their grade may increase, stay the same or decrease.
The result of the regrade is final. All regrades must be requested within one week of the
distribution of grades for the given quiz.

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Makeup Policy
In general, makeups for quizzes and the final exam (i.e., taking a quiz or exam at an alternate
time because you are not able to take it at the original time) are not allowed. Except
in exceptional circumstances (e.g., imminent childbirth for self or spouse), you
are expected to take and complete the quizzes and the final exam during their
designated windows.
In the extraordinary case that you are granted a makeup for one of the quizzes or the
final exam, we enforce a strict policy of a maximum of one makeup per student:
1. If you are granted a makeup for a quiz, you will not be granted any further
makeups, either for the quiz in question, for any later quizzes or for the
final exam.
2. If you are granted a makeup for the final exam, you will not be granted any
further makeups for the final exam.
If you do not take and complete the makeup quiz/final exam at the agreed upon
makeup time, you will receive a zero for the corresponding quiz/exam.

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Class Schedule
(Please note that the following is a tentative plan; some topics may get shuffled/changed
slightly depending on the pace with which we progress through the quarter.)

Class Date Topic Reading Case Due

1 Sep 26 Descriptive Statistics 3.1-3.2

Probability Definitions 4.1-4.4

2 Oct 03 Bayes Rule 4.5 Browser Wars Homework 1

Intro to Decision Analysis 21.1

3 Oct 10 Decision Analysis 21.2 Freemark Abbey Homework 2

Discrete Random Variables 5.1-5.3 Quiz 1:
10/11 12pm - 10/14 12pm

4 Oct 17 Binomial Distribution 5.5

Continuous Random Variables 5.1
Normal Distribution 6.2

5 Oct 24 Joint Random Variables 2.4 Portfolio Homework 3

Covariance and Correlation 3.5, 5.4 Quiz 2:
10/25 12pm - 10/28 12pm

6 Oct 31 Sampling 7.1-7.6

Central Limit Theorem 8.1-8.4
Intro to Confidence Intervals

7 Nov 07 Confidence Intervals 8.1-8.4 A/B Testing Homework 4

Simple Linear Regression 14.1-14.7 at Vungle Quiz 3:
14.8 11/8 12pm - 11/11 12pm

8 Nov 14 Simple Linear Regression 15.1-15.3

Intro to Multiple Regression

9 Nov 21 Multiple Regression 15.4-15.7 Santa Monica

16.1 Real Estate

– Nov 28 Thanksgiving

10 Dec 05 Advanced Regression Topics Moneyball Homework 5

11 Dec 12 Final Exam

12pm 12/10 - 11:59pm 12/12