NATIONAL OPEN UNIVERSITY OF NIGERIA

UNIVERSITY VILLAGE, PLOT 91, CASDASTRAL ZONE, NNAMDI AZIKIWE EXPRESS WAY, JABI, ABUJA.
FACULTY OF MANAGEMENT SCIENCES
SEPTEMBER 2020 EXAMINATION

COURSE CODE: BUS 406
COURSE TITLE: ANALYSIS FOR BUSINESS DECISIONS
CREDIT UNITS: 3
INSTRUCTION: 1. Indicate your Matriculation Number clearly
2. Attempt question one (1) and any other three (3) questions – four questions in all
3. Question one (1) is compulsory and carries 25marks, while the other questions carry 15marks each.
4. Present all your points in coherent and orderly Manner
TIME ALLOWED: 3Hrs
QUESTION ONE
(a) State the elements of a typical decision situation in Nigeria.
(b) The matrix below shows the payoffs of an investor who has the choice either investing in the production of HB pencils, BB Pencils or crayon. The market demand forecast for any of the product are as depicted in the payoff. Calculate and show which product should be produced using maximax model. 25marks

QUESTION TWO
(a) The process of analysing decision can be grouped into four phases. List and explain these four phases. 8 marks
(b)Since decisions are made by human beings, certain errors are bound to happen. The decision maker need to be aware of them and guide against their occurrence. Please discuss such possible errors in real life situations. 7 marks
Alternative
products
Market demand
high moderate low
HB Pencil 500 250 -75
BB Pencil 700 300 -60
Crayon 400 200 -50QUESTION THREE
There are two broad objectives that decision makers can possibly set to achieve in. Explain
them in detail. 15marks
QUESTION FOUR
Chief Adakole is considering where to invest his BetNiaja win. He has received
suggestions from friends to invest in the projects represented in the table below, along
with their relevant probabilities of success given by agric consultants, as, indicated in the
pay-off table below:
Using EMV criterion, advise him as to the best project to embark on.
Decision to
invest
States of nature
good poor turbulent
D1 50 30 15
D2 100 40 10
D3 30 10 -2
P 0.5 0.3 0.2
15marks

QUESTION FIVE
(a) Define Modelling, with special reference to Operations Research. 5 marks
(b) List and discuss the advantages of models. 10 marks.

QUESTION SIX
(a) What is Operations Research? 5 marks
(b) List and discuss the characteristics of Operations Research. 10 marks