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UNIVERSITY OF WARWICK

WARWICK BUSINESS SCHOOL

OPERATIONAL RESEARCH AND MANAGEMENT SCIENCES GROUP

IB121L: QUANTITATIVE ANALYSIS FOR MANAGEMENT I (12 CATS)

2011/2012 Introduction This course provides an introduction to basic statistical methods including data presentation, descriptive statistics, probability theory, basic probability distributions, decision trees, sampling and confidence intervals, basic chi-squared tests, correlation, introductory regression. Use will be made of Excel where appropriate and the emphasis will be on analysis for decision making and applications as well as the analysis of your own data sets later on in your degree studies. Course outline

Week TUTORIAL Monday or

Tuesday

LECTURE 1 Mon 12.00-13.00, R0.21

LECTURE 2 Fri 10.00-11.00, R0.21

Term 1 1

2 Introduction and the nature of statistical models Descriptive statistics-Graphical

3 Descriptive statistics-Numerical Using Excel 4 Probability and Bayes Theorem Decision Trees I

5 Decision Trees II Probability Distributions I Binomial and Poisson

6 Probability Distributions II Normal Probability Distributions III Approximations 7 Sampling Confidence Intervals single sample 8 Chi-squared tests Correlation 9 Regression 1 Regression II

10 Review Class Test (for those doing QAMI only) NB Time and room change: 15.00-17.00 in F1.07 (Engineering)

Surgeries: Monday 17.00-18.00, S0.28 Wednesday 14.00-15.00, C1.11/15

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Textbooks Quantitative Analysis for Management, compiled by Stephanie Stray and Kathy Kotiadis, Volumes 1 and 2, 3rd edition, Pearson, 2009. This two volume publication has been specially compiled for the QAMI and QAMII modules and is only available for purchase from the University Bookshop. Additionally, details of the necessary reading and tutorial work for this module using the source text books (rather than the two volume compiled version) are also available for the module under the Resources section of my.wbs. Should you wish to consult the library copies of texts for this module, please note that you can use the source texts as an alternative to the compiled versions. If you are taking QAMI only (and are not planning on doing QAMII at any stage) and wish to purchase the text then you should buy Quantitative Analysis for Management, Volume 1 only. Do NOT purchase secondhand copies of the 1st edition of Quantitative Methods of Analysis Vols 1 and 2 by Stephanie Stray as this text was for different modules and the subject matter has changed. If you buy second-hand copies of the 2nd edition of Quantitative Methods of Analysis Vols 1 and 2 by Stephanie Stray and Les Oakshott you will find that the vast majority of the material is the same but the page numbering is different and there is no index. You will need to consult library texts for the additional material not present in the 2nd edition. Assessments QAM I is assessed in two different ways. Those taking QAM I only in 2011/12: 1 hour (open book) class test at end of term 1 Those taking QAM I and QAM II in 2011/12: 3 hour (open book) examination in term 3 Note that both the term 1 test and the June exam are open book. This means you may bring with you any textbooks, lectures notes, seminar notes, worked examples etc but, under University regulations, may not bring a University of Warwick library book. You are expected to provide your own calculator and copies of statistical tables. Note that calculators must be non-programmable which means that they must not be capable of storing text laptops, mobile phones or PDAs etc (i.e. anything capable of external communication) are not permitted. Lecturers and Tutors Lecturers Dr Katy Hoad (Module Manager)

Dr Gabriela Czanner Tutors Jawaad Elomari, Sadia Farooq, Shamaila Ishaq, Christoph Pickardt, Martin

Simanjuntak, Chenlan Wang Your first point of contact for queries about the module and tutorial content should be your QAMI tutor during the tutorials. If you are still having difficulties then please attend one (or both) of the two weekly surgeries.

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Lectures The module starts in week 2 with lectures taking place twice a week. A copy of this outline will be given at the first lecture (spares will be placed in the Undergraduate Office). A copy is also available on my.wbs. All lecture slides will be put on my.wbs in advance of lectures. Tutorials Information on times and rooms for tutorials will be provided at a later date by the Undergraduate Office. All students will be assigned to a tutorial group. Tutorials take place on Mondays and Tuesdays and will start in Week 3. A list of tutorial groups will be posted on my.wbs. Please ensure that, prior to Monday 9:00am of week 3, you know which group you are in and, from the list to be provided, know where and when your group meets. Note that tutorials take place every week through to the end of term. You might want to check out the location of the room prior to the first tutorial. Records for tutorial attendance will be kept by your tutor. Attendance at tutorials is compulsory. If you do not attend a tutorial, then you are responsible for informing your QAM I tutor (via my.wbs) and providing an appropriate reason with the necessary supporting documentary evidence (e.g., medical note). Saying you went home for the weekend, or failed to wake up in time do not constitute valid reasons for missing tutorials and if you give such a reason you will be marked as absent as is also the case if you fail to give a reason at all. Information upon attendance is required by the University and the potential penalties for persistent non-attendance are severe. In addition to the tutorials there are two weekly surgery sessions that you can attend in the event of you having problems or queries that have not been covered in your tutorial. These will also start in week 3 and will take place on Mondays, 17.00-18.00 in S0.28 and Wednesdays, 14.00-15.00 in C1.11/15. QUANTITATIVE ANALYSIS FOR MANAGEMENT I (15 CATS) All Business School students may ignore this section. If you are taking QAM I as a 15 CATS module then you should be aware that the method of assessment differs to the 12 CATS version. Those taking QAMI only (15 CATS version) in 2011/12:

1 piece of assessed work in term 1 - to be handed in at start of term 2 (20%) 1 hour class test at end of term 1 (80%)

Those taking both QAMI and QAMII (both as 15 CATS versions) in 2011/12: 1 piece of assessed work in term 1 to be handed in at start of term 2 (10%) 1 piece of assessed work in term 2 to be handed in at start of term 3 (10%)

3 hour (open book) examination in term 3 (80%) It is your responsibility to notify both the module manager (K. Hoad) and the Undergraduate Office by the start of week 3 of term 1 if you are taking the 15 CATS point variant of QAMI. If you are in doubt then you should contact your own department for clarification. All Business School students take the 12 CATS point variant.

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IB121L: Quantitative Analysis for Management I

Set Reading and Tutorials for Academic Year 2011/2012

Text Quantitative Analysis for Management, compiled by Dr Stephanie Stray and Kathy Kotiadis, 3rd edition, Volume 1 Pearson, 2009. Selected problems have answers in the back of the books. A selection of these have been set for self-learning purposes. Reading and Tutorial work Attendance at tutorials is compulsory. All reading and exercises are to be done in advance of the tutorial. Thus the reading and questions listed below for week 3 should be attempted before the Monday/Tuesday tutorial of week 3. Self-study questions are for you to do prior to attempting the tutorial questions and answers are available at the back of the texts. Additional exercises may be handed out during lectures from time to time. For Week 2: Introduction to Statistical Models Reading: Topic 1 Tutorial: No tutorial this week For Week 3: Graphical Data Summaries including Histograms Reading: Topic 2 (pages 13-33, pages 37-46) Self-study: Topic 2 Exercises: 2.2, 2.12, 2.14, 2.16, 2.20, 2.52 Tutorial: Topic 2 Exercises : 2.1, 2.13, 2.21, 2.47 For Week 4: Numerical Descriptive Statistics Reading: Topic 3 (pages 52-70) Self-study: Topic 3 Exercises: 3.2, 3.12, 3.30 Tutorial: Topic 3 Exercises: 3.1, 3.5, 3.13, 3.15(a and b only), 3.31 For Week 5: Probability, Bayes Theorem Reading: Topic 4 (pages 86-121, pages 128-134) Self-study: Topic 4 Exercises: 4.20, 4.22, 4.24, 4.50, 4.80, 4.86 Tutorial: Topic 4 Exercises: 4.19, 4.21, 4.23, 4.51, 4.81, 4.85

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For Week 6: Decision trees and Binomial and Poisson probability distributions Reading: Topic 5 (page 144-174)

Topic 6 (pages 188-194, pages 204-210, pages 214-217) Self-study: Topic 5 Exercises: 21.12, 21.16, 21.20, 21.28

Topic 6 Exercises: 5.32, 5.36, 5.38, 5.60, 5.64, 5.72 Tutorial: Topic 5 Exercises: 21.23, 21.37

Topic 6 Exercises: 5.35, 5.37, 5.59, 5.67 For Week 7: Normal distribution and Approximations Reading: Topic 6 (page 217-219)

Topic 7 (pages 243-249, pages 253-261, pages 266-271) Self-study: Topic 6 Exercises 5.68

Topic 7 Exercices: 6.20, 6.26, 6.40 Tutorial: Topic 6 Exercise 5.69

Topic 7 Exercices: 6.19, 6.25, 6.39, 6.47 For Week 8: Sampling and Confidence intervals Reading: Topic 8 (pages 291-311)

Topic 9 (pages 314-342) Topic 10 (pages 359-371, pages 379-385)

Self-study: Topic 9 Exercises 7.10, 7.14, 7.32 Topic 10 Exercises: 8.14, 8.16, 8.34, 8.38

Tutorial: Topic 9 Exercises: 7.3, 7.17, 7.31, 7.37 Topic 10 Exercises: 8.13, 8.15, 8.41, 8.57

For Week 9: Chi-squared tests and Correlation Reading: Topic 11 (pages 388-395, pages 398-402) Topic 3 (pages 71-79)

Topic 12 (pages 412-417) Self-study: Topic 11 Exercises: 16.2, 16.12, 16.20, 16.24

Topic 3 Exercises: 3.42, 3.44 Topic 12 Exercise: 12.4

Tutorial: Topic 11 Exercises: 16.1, 16.11, 16.17 Topic 3 Exercises: 3.43

Topic 12 Exercise: 12.5 For Week 10: Regression Reading: Topic 12 (pages 417-444) Self-study: Topic 12 Exercises: 12.8(a), 12.12, 12.20, 12.26, 12.30, 12.38, 12.44 Tutorial: Topic 12 Exercise: 12.13, 12.19, 12.39, 12.45

Further copies of this handout can be obtained from the Study Materials section of the QAM I module on my.wbs

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For ALL students taking Quantitative Analysis for Management I & II (QAMI & QAMII) Financial Management (FM) or Economics for Business (Eco for Bus)

SUPPLEMENTARY MATHEMATICS 2011/2012

For those students without an A-level Maths (or an equivalent) qualification you may find that there are certain mathematical topics that you will need to know about for Quantitative Analysis for Management I & II (QAMI & QAMII) Financial Management (FM) or Economics for Business (Eco for Bus). Even if you have an A-level mathematics qualification, there may also be topics about which you wish to remind yourself. Eight worksheets on a variety of mathematical topics can be downloaded from the Resources section of QAM I on my.wbs. These are for you to try. These worksheets are supported by reading from the QAM I text and by the Understanding Business Mathematics teaching software provided on my.wbs (see below). If you are unsure about your maths ability, download the worksheets (see below for a list), and attempt the questions. If you get stuck undertake the relevant reading and look at the relevant part of the Understanding Business Mathematics software and try the worksheet(s) again. If you are still stuck or unclear then there are fortnightly surgeries in term 1 to provide support. You must take your worksheet(s) with you and be willing to discuss the efforts you have made. These surgeries will be MONDAYS 18:00-19:00, IN S0.21 IN WEEKS 3, 5, 7 AND 9. Supplementary maths for QAM I & II and FM Quantitative Analysis for Management I & II (QAM I & II) and Financial Management (FM) assume that you are confident with a number of basic mathematical skills covered at GCSE A level. If you did not do a quantitative subject at Advanced level it may be some years since you tackled problems of this kind. In order to revise and consolidate the required skills the Outline below lists a schedule of reading and software support. Anyone who wishes to refresh their maths is welcome to use this material but those without A level Maths (or its equivalent) taking QAM I or QAMI & II are strongly urged to do so. Details of the topics are given below. You can, of course, use your own GCSE materials or you may find Essential Mathematics: A refresher course for Business and Social Studies by C. Morris and E. Thanassoulis useful. You should also note that Financial Management also assumes knowledge of arithmetic and geometric series and some understanding of calculus is required in 2nd and 3rd year finance modules. Supplementary maths for Economics for Business In addition to the above, the material indicated below will cover univariate and multivariate calculus, as needed for Economics for Business (Eco for Bus), with emphasis on problem solving as well as theory. You may undertake all or part of the material as your needs dictate. Anyone who wishes to refresh their maths is welcome to use the material but those without A level Maths (or its equivalent) taking Economics for Business are strongly urged to do so. Topic details are given below.

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Outline

Worksheet

Module Contents Reading* Software** Surgery week

1 QAM I & II, FM & Eco for Bus

Basic Algebra I - Functions, non-linear functions, equations, factorisation

pp. 468-484 Sections 1- 8

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2 QAM I & II, FM & Eco for Bus

Basic Algebra II - Functions, non-linear functions, equations, factorisation

pp. 468-484 Sections 1-8

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3 QAM II, FM & Eco for Bus

Basic Algebra III Systems of linear equations, inequalities, simple graphs

pp. 484-486 Sections 9-11

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4 QAM II, FM & Eco for Bus

Basic Algebra IV - Non-linear functions and graphs

pp. 487-489 Sections 9-11

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5 FM & Eco for Bus Arithmetic & Geometric series

pp. 492-495 7

6 FM & Eco for Bus Introduction to Calculus

pp. 506-510 Section 12

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7 FM & Eco for Bus Calculus applications of differentiation I

pp. 510-512 Sections 13-15

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8 FM & Eco for Bus Calculus - applications of differentiation II

pp. 513-522 Sections 13-15

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* all reading is from the module text Quantitative Analysis for Management, volume 1 ** all use of software is from Understanding Basic Mathematics, The Basics algebra, graphs and differentiation. Detailed content: Basic Algebra: types of numbers, fractions, rounding, percentages, symbols, powers, roots, factorising,

simplification, equations, concept of functions, linear functions, solving linear functions, graphs, graphing linear functions, non-linear functions

Systems of equations: algebraic and graphical solutions, solving linear, quadratic and more complex equations, equations with more than one variable;

Inequalities, solving linear inequalities, graphing inequalities, quadratic functions, exponential functions, logarithms and logarithmic functions, other functions

Arithmetic and geometric series Calculus: the derivative, higher order derivatives, partial derivatives, turning points, maximum and

minimum points of functions. Understanding Business Mathematics teaching software This is provided on my.wbs. In my.wbs go to QAM I, click on EQL and then on Understanding Business Maths 3 and follow the instructions. All the above are from the first topic The Basics algebra, graphs and differentiation, which is divided into 16 sections. The table above indicates the relevant sections.