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produce meaningful information. Information  The Quantitative Analysis Approach

Defining the Problem Developing a Model Acquiring Input Data Developing a Solution Testing the Solution Analyzing the Results   Implementing the Results

SPD4524 - L01 - Introduction

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• Quantitative analysis models are realistic, solvable, and understandable mathematical representations of a situation. \$ Sales Schematic models 10 " id="pdf-obj-9-12" src="pdf-obj-9-12.jpg">

• There are different types of models: Scale
models
SPD4524 - L01 - Introduction

models Schematic models 10 " id="pdf-obj-9-23" src="pdf-obj-9-23.jpg">

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In Process – Sensitive models should be very thoroughly tested. – For example: elasticity • Profit = Revenue – Expenses variable costs. Variable costs are the product of unit costs times the number of units.  19

SPD4524 - L01 - Introduction

• The decision variable of interest is X • If sales = 1,000,  Companies are often interested in the break-even point (BEP). The BEP is the number of units sold that will result in \$0 profit. or Solving for X, we have  Pritchett’s Precious Time Pieces – This is the main menu of quantitative models SPD4524 - L01 - Introduction

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– Works automatically within Excel spreadsheets SPD4524 - L01 - Introduction

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Selecting Break-Even Analysis in Excel QM SPD4524 - L01 - Introduction

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– The validity of the data may be suspect. References

Cengage Learning. Dependent
Yes
No
Variable (DV)
Y 1 +Y 2 +
...
=α+aX
1 +bX 2 +
...
IV
DV
DV
No
Yes
more than
one
DV
DV
Independent
quantitative or
quantitative or
Variable (IV)
qualitative
qualitative
quantitative or
qualitative
Qualitative
Quantitative
Quantitative
IV
IV
IV
quantitative or
quantitative or
quantitative or
qualitative
qualitative
qualitative
Quantitative
Quantitative
Quantitative
Qualitative
Qualitative
Qualitative
Qualitative
Discriminant
t test/
Cluster analysis/
MANOVA/
Canonical
Conjoint
analysis/
ANOVA/
Multiple
Conjoint
Factor analysis/
Canonical
correlation/
analysis
Logit/
Multiple
regression
analysis
Multidimensional
correlation
SEM
Probit
regression
scaling analysis/
ꭕ2 test