CHE188: Quantitative Methods in Management Engr. Elisa G.

Eleazar

 Introduction Steps

in Decision-Making

Components

of Decision-Making Problems
Models

Mathematical

Quantitative Methods in Management

DecisionMaking

a course of action which is consciously chosen from among a set of alternatives to achieve a desired result

involves the selection of a course of action from among two or more possible alternatives in order to arrive at a solution for a given problem

Characteristics

of Decision-making

implies

choice continuous intellectual based on reliable information goal-oriented

Quantitative Methods in Management

Problem recognition, definition and evaluation

Problem analysis

Development of alternative solutions

Selection of the best solution

Conversion of the decision into action

Feedback / Follow-up

Quantitative Methods in Management

Quantitative Methods in Management

Suppose that you have a 5-week business commitment between Manila (MNL) and Cebu (CEB). You fly out of Manila on Monday and return on Wednesday. A regular round-trip ticket costs Php4,000, but a 20% discount is granted if the dates of the ticket span a weekend. A oneway ticket in either direction costs 75% of the regular price. How should you buy the tickets for the 5-week period?

Quantitative Methods in Management

variables

objective

constraints

Suppose that you are to construct a maximum-area rectangle out of a piece of wire of length L in inches. What should be the width and height of the rectangle?
Quantitative Methods in Management

variables

objective

constraints
Feasible Solution

satisfies all constraints yields the best (maximum or minimum) value of the objective function
8

Optimal Solution

Quantitative Methods in Management

Model

abstraction of a real-life system used to facilitate understanding and to aid in decision making in the form of a formula or equation

Linear Programming

Transportation Models Decision Analysis Models Queuing Models

Network Models

Forecasting Models

Inventory Models

Quantitative Methods in Management

 Introduction Steps

in Decision-Making

Components

of Decision-Making Problems
Models

Mathematical

Quantitative Methods in Management

10

CHE188: Quantitative Methods in Management Engr. Elisa G. Eleazar