Clinical judgement in prescribing includes

a. Factoring in the cost to the patient of the medication prescribed

b. Always prescribing the newest medication available for the disease process

c. Handing out drug samples to poor patients

d. Prescribing all generic medications to cut costs

For a company, the cost of providing security on its buildings is an example of which type of cost behaviour?

1. Fixed costs
2. Stepped costs
3. Semi-variable costs
4. Variable costs

Suppose that a person is considering an investment in a new product. The cost of producing and marketing the product is estimated to be $6 000. Three possible outcomes can result from this investment:

• The product can be extremely successful and yield a net profit of $24,000.
• The product can be moderately successful and yield a net profit of $12,000.
• The product can be unsuccessful, in which case the loss will be equal to the initial cost of producing and marketing the product (that is, $6,000).

Additionally, assume that if the person does not invest in the new product, the $6,000 can be invested in another venture that is certain to yield a net profit of $1,500. Furthermore, suppose that he or she has assessed the chances of the product being extremely successful, moderately successful, and unsuccessful at .10, .20, and .70, respectively.

You are required to do the following:

1. Determine the decision alternatives.
2. Determine the possible outcomes for each decision alternative.
3. Formulate the problem in a payoff table format showing the net profit that will result from each alternative action/state-of-nature combination.
4. Determine the expected net profit of each decision alternative.
5. Assuming that the objective is to maximise expected monetary payoff, which alternative should be chosen?

Excel input:

Consider the cost of assigning a task to an individual as shown in the table below. It is assumed that each individual can be assigned to at most one task, and each task can be assigned to at most one individual. The objective is to minimize the cost of assignments.

(a) Write down the linear programming formulation of this problem. (i.e., write down the objective function and constraints – do not use a tableau.)

(b) Using the Hungarian Algorithm, solve this assignment problem (i.e., the problem described on the previous page). Please show the order in which the tableaus are used!

(c) State the optimal values of the variables and the optimal objective function.

A firm faces the demand schedule as ? = 660 − 3?
and the total cost schedule as
?? = 6?^3 − 72?^2 + 240? + 25. Please answer the followings:
a. Does the above cost function satisfy the parametric restrictions we derived in the class?
b. What is the maximum profit the firm can make? Confirm your results with second order
conditions as well.

People in the aerospace industry believe the cost of a space project is a function of the mass of the major object being sent into space. Use the following data to develop a regression model to predict the cost of a space project by the mass of the space object. Determine r2 and se. Weight (tons) Cost ($ millions) 1.897 $ 53.6 3.019 184.7 0.453 6.4 0.993 23.5 1.058 33.3 2.100 110.4 2.392 104.6 *(Do not round the intermediate values. Round your answers to 4 decimal places.) **(Round the intermediate values to 4 decimal places. Round your answer to 3 decimal places.) ŷ = enter a number rounded to 4 decimal places * + enter a number rounded to 4 decimal places * x r2 = enter a number rounded to 3 decimal places ** se = enter a number rounded to 3 decimal places **

ŷ = enter a number rounded to 4 decimal places  

* + enter a number rounded to 4 decimal places

* x
r² = enter a number rounded to 3 decimal places  **
s_e = enter a number rounded to 3 decimal places  **

You are buying a car at a cost of $42,000 by taking a loan. The nominal interest rate is 9% per annum compounded monthly. The bank offers 2 options for the structure of the repayments. Option 1: The loan will be repaid over 10 years by equal month-end-instalments.

a) Calculate the monthly instalment. (1 mark)

b) Calculate the interest component for the 20th repayment.

c) Calculate the loan outstanding immediately after 8 years (immediately after the payment on that date). d) Hence or otherwise, calculate the cumulative principal repayments during the 9th year.

Option 2: Month-end-instalments of $X will be made for the first 3.5 years. Then the bank offers you a payment free period (i.e., no repayments required) of 1 year. After that, the remaining balance will be repaid over 3.5 years by month-end-instalments of $2X.

e) Calculate X.

People in the aerospace industry believe the cost of a space project is a function of the mass of the major object being sent into space. Use the following data to develop a regression model to predict the cost of a space project by the mass of the space object. Determine r² and s_e.

Weight (tons) Cost ($ millions)

1.897 $ 53.6

3.019 $185.2

0.453 $6.4

0.960 $23.5

1.058 $33.5

2.100 $110.4

2.392 $104.6

ŷ = ________ + __________ x

r2 = _______________

se = ___________________