LOMA 308 Module 3 Exam
Questions and Answers All
Correct
A graphical scheduling tool that separates projects into critical activities and plots
starting and ending dates for each activity.
Flow chart
Gantt chart
PERT network - Answer-Gantt chart
A project scheduling tool that helps shorten the length of time needed to complete large,
complex projects.
Flow chart
Gantt chart
PERT network - Answer-PERT network
A graphic representation of a sequence of activities and decisions.
Flow chart
Gantt chart
PERT network - Answer-Flow chart
Dashboards - Answer-When you look at the dashboard in your car, you can see—at a
glance—how your car is performing. For example, your car dashboard probably
includes a variety of dials and gauges showing you how much gas you've used, how
many miles you've driven, what your current speed is, and how many RPMs your car's
engine is producing. You can even see the current time and temperature. In some
cases, you can get more detailed information, too, such as average miles per gallon or
average speed.
A performance dashboard shows the same kind of information about a company's
performance. Like a car dashboard, a performance dashboard puts all the information
managers need to evaluate the performance of the company or of individual business
units in one place.
- pie chart
- heat map
- guage
- bar graph
- line graph
,How Managers Use Dashboard - Answer-Because dashboards capture and report
specific data from various departments within a company, they allow management to
Monitor the contributions of various departments
Measure operating efficiencies and inefficiencies
Make informed decisions based on collected business intelligence
Align company strategies with the company's business goals
Eliminate the need for multiple runs to produce data
Balanced Scorecards - Answer-Managers use balanced scorecards to assign target
outcomes to a small number of financial or nonfinancial activities and then monitor their
actual performance to see how closely current performance meets expectations. To
create a scorecard, management generally
Translates the company's mission statement into specific operational goals
Links the identified goals to individual areas of performance
Sets target performance levels or indexes for each area
Compares actual performance against targeted performance
Scorecards allow managers to identify potential problem areas and take action where
necessary, also allowing managers to feed results back into the planning process to
adjust strategies. Scorecards often are simple tables broken down into major sections
with specific objectives, performance measures, trends, and initiatives for each section.
general performance categories:
- financial
- customer
- internal business
- growth and innovation
Which company sold more policies, Rainwater or Snowfall?
Rainwater
Snowfall
Rainwater and Snowfall sold the same number of policiesfeedback for question 3 -
Answer-Rainwater and Snowfall sold the same number of policies. Graph A uses a
scale of 0 to 4.5 and Graph B uses a scale of 0 to 45. The actual sales figures are the
same in both graphs, but the impression they give is very different. Because Graph B
uses a scale 10 times larger than Graph A, sales appear much flatter in Graph B than in
Graph A, making it appear that Rainwater sold more policies.
Insurance companies only use dashboards to evaluate their sales staff performance.
True
False - Answer-Although dashboards commonly focus on sales, they can be used for
other applications, including recruiting, human resources, company operations, project
management, and customer relationship management.
,Managers use (dashboards / balanced scorecards) to assign target outcomes to a small
number of financial or nonfinancial activities and then monitor the actual performance of
those activities to see how closely current performance meets expectations.
Dashboards
Balanced scorecards - Answer-Balance scorecards - Managers use balanced
scorecards to assign target outcomes to a small number of financial or nonfinancial
activities and then monitor the actual performance of those activities to see how closely
current performance meets expectations.
Interest on investments, 3 factors affect their growth - Answer-1. Interest rate
2. The type of interest
3. The time period during which the invested principal earns interest
Interest rates - Answer-Remember that interest is a fee that individuals and financial
institutions pay (or charge) for the use of borrowed money. And the amount of interest
earnings depends on the interest rate that's applied to the principal.
Interest rates are usually stated in decimal form, so a 5 percent interest rate appears as
0.05 and a 2.5 percent rate appears as 0.025.
Interest earned = $1,000 × 0.025 = $25
Calculating Interest Earned - Answer-Principal (regular amount) × Interest rate =
Interest earned
Interest rate - Answer-Interest rate = Interest amount ÷ Principal
simple interest - Answer-the amount of interest earned for one year is equal to the
principal multiplied by the interest rate. As a result, when an investment earns simple
interest, the nominal interest rate and the effective interest rate are the same.
The total amount of simple interest earned is equal to the interest for one year multiplied
by the number of years in the investment period.
At a constant annual rate of 5% simple interest, after 100 years the $10 account would
have earned $50 in interest (100 x $0.50), and the total value of the investment would
be $60.00.
Compound interest - Answer-When interest is compounded, the interest earned each
investment period is added to the original principal amount, and that total is used as the
beginning balance when calculating interest earnings for the next period. In this case,
the effective interest rate is greater than the nominal interest rate.
Compound Interest:
At a constant annual rate of 5% compound interest, after 100 years the $10 investment
would have earned $1,305.01 in interest and the total value of the investment would be
$1,315.01.
, Effective Interest Rate - Answer-The type of interest rate that includes the effects of
compounding.
The Rule of 72 - Answer-Investors can use a simple rule of thumb known as the Rule of
72 to estimate how fast a principal sum doubles at a specified compound interest rate.
The Rule of 72 states that, for a known interest rate, under annual compounding, the
approximate number of years for a principal sum to double is 72 divided by the interest
rate.
Years to double = 72 ÷ Interest rate
Steadfast Insurance can calculate the interest amount it earned on an initial sum of
money invested for one year at a specified interest rate by ( multiplying / dividing ) the
principal by the interest rate.
multiplying
dividing - Answer-Multiplying- An investor can calculate the interest amount earned on
an initial sum of money invested for one year at a specified interest rate by multiplying
the principal by the interest rate.
Because ( simple / compound ) interest is applied to the same amount of principal each
year, the amount of interest earned each year is the same, found by multiplying the
principal amount by the interest rate.
simple
compound - Answer-simple- Because simple interest is applied to the same amount of
principal each year, the amount of interest earned each year is the same, found by
multiplying the principal amount by the interest rate.
Because the nominal interest rate includes the effects of compounding, it's usually
greater than the effective interest rate.
True
False - Answer-False- Because the effective interest rate includes the effects of
compounding, it's usually greater than the nominal interest rate. And it increases even
more if interest is compounded more than once each year.
Steadfast Insurance can use the Rule of 72 to
A. Estimate how fast a principal sum doubles at a specified compound interest rate
B. Determine the rate of interest a principal sum must earn to double in a certain
number of years.
Both A and B
A only
B only
Neither A nor B - Answer-The Rule of 72 states that, for a known interest rate, under
annual compounding, the approximate number of years for a principal sum to double is
72 divided by the interest rate.The Rule of 72 can also help determine the rate of
interest a principal sum must earn to double in a certain number of years.
Questions and Answers All
Correct
A graphical scheduling tool that separates projects into critical activities and plots
starting and ending dates for each activity.
Flow chart
Gantt chart
PERT network - Answer-Gantt chart
A project scheduling tool that helps shorten the length of time needed to complete large,
complex projects.
Flow chart
Gantt chart
PERT network - Answer-PERT network
A graphic representation of a sequence of activities and decisions.
Flow chart
Gantt chart
PERT network - Answer-Flow chart
Dashboards - Answer-When you look at the dashboard in your car, you can see—at a
glance—how your car is performing. For example, your car dashboard probably
includes a variety of dials and gauges showing you how much gas you've used, how
many miles you've driven, what your current speed is, and how many RPMs your car's
engine is producing. You can even see the current time and temperature. In some
cases, you can get more detailed information, too, such as average miles per gallon or
average speed.
A performance dashboard shows the same kind of information about a company's
performance. Like a car dashboard, a performance dashboard puts all the information
managers need to evaluate the performance of the company or of individual business
units in one place.
- pie chart
- heat map
- guage
- bar graph
- line graph
,How Managers Use Dashboard - Answer-Because dashboards capture and report
specific data from various departments within a company, they allow management to
Monitor the contributions of various departments
Measure operating efficiencies and inefficiencies
Make informed decisions based on collected business intelligence
Align company strategies with the company's business goals
Eliminate the need for multiple runs to produce data
Balanced Scorecards - Answer-Managers use balanced scorecards to assign target
outcomes to a small number of financial or nonfinancial activities and then monitor their
actual performance to see how closely current performance meets expectations. To
create a scorecard, management generally
Translates the company's mission statement into specific operational goals
Links the identified goals to individual areas of performance
Sets target performance levels or indexes for each area
Compares actual performance against targeted performance
Scorecards allow managers to identify potential problem areas and take action where
necessary, also allowing managers to feed results back into the planning process to
adjust strategies. Scorecards often are simple tables broken down into major sections
with specific objectives, performance measures, trends, and initiatives for each section.
general performance categories:
- financial
- customer
- internal business
- growth and innovation
Which company sold more policies, Rainwater or Snowfall?
Rainwater
Snowfall
Rainwater and Snowfall sold the same number of policiesfeedback for question 3 -
Answer-Rainwater and Snowfall sold the same number of policies. Graph A uses a
scale of 0 to 4.5 and Graph B uses a scale of 0 to 45. The actual sales figures are the
same in both graphs, but the impression they give is very different. Because Graph B
uses a scale 10 times larger than Graph A, sales appear much flatter in Graph B than in
Graph A, making it appear that Rainwater sold more policies.
Insurance companies only use dashboards to evaluate their sales staff performance.
True
False - Answer-Although dashboards commonly focus on sales, they can be used for
other applications, including recruiting, human resources, company operations, project
management, and customer relationship management.
,Managers use (dashboards / balanced scorecards) to assign target outcomes to a small
number of financial or nonfinancial activities and then monitor the actual performance of
those activities to see how closely current performance meets expectations.
Dashboards
Balanced scorecards - Answer-Balance scorecards - Managers use balanced
scorecards to assign target outcomes to a small number of financial or nonfinancial
activities and then monitor the actual performance of those activities to see how closely
current performance meets expectations.
Interest on investments, 3 factors affect their growth - Answer-1. Interest rate
2. The type of interest
3. The time period during which the invested principal earns interest
Interest rates - Answer-Remember that interest is a fee that individuals and financial
institutions pay (or charge) for the use of borrowed money. And the amount of interest
earnings depends on the interest rate that's applied to the principal.
Interest rates are usually stated in decimal form, so a 5 percent interest rate appears as
0.05 and a 2.5 percent rate appears as 0.025.
Interest earned = $1,000 × 0.025 = $25
Calculating Interest Earned - Answer-Principal (regular amount) × Interest rate =
Interest earned
Interest rate - Answer-Interest rate = Interest amount ÷ Principal
simple interest - Answer-the amount of interest earned for one year is equal to the
principal multiplied by the interest rate. As a result, when an investment earns simple
interest, the nominal interest rate and the effective interest rate are the same.
The total amount of simple interest earned is equal to the interest for one year multiplied
by the number of years in the investment period.
At a constant annual rate of 5% simple interest, after 100 years the $10 account would
have earned $50 in interest (100 x $0.50), and the total value of the investment would
be $60.00.
Compound interest - Answer-When interest is compounded, the interest earned each
investment period is added to the original principal amount, and that total is used as the
beginning balance when calculating interest earnings for the next period. In this case,
the effective interest rate is greater than the nominal interest rate.
Compound Interest:
At a constant annual rate of 5% compound interest, after 100 years the $10 investment
would have earned $1,305.01 in interest and the total value of the investment would be
$1,315.01.
, Effective Interest Rate - Answer-The type of interest rate that includes the effects of
compounding.
The Rule of 72 - Answer-Investors can use a simple rule of thumb known as the Rule of
72 to estimate how fast a principal sum doubles at a specified compound interest rate.
The Rule of 72 states that, for a known interest rate, under annual compounding, the
approximate number of years for a principal sum to double is 72 divided by the interest
rate.
Years to double = 72 ÷ Interest rate
Steadfast Insurance can calculate the interest amount it earned on an initial sum of
money invested for one year at a specified interest rate by ( multiplying / dividing ) the
principal by the interest rate.
multiplying
dividing - Answer-Multiplying- An investor can calculate the interest amount earned on
an initial sum of money invested for one year at a specified interest rate by multiplying
the principal by the interest rate.
Because ( simple / compound ) interest is applied to the same amount of principal each
year, the amount of interest earned each year is the same, found by multiplying the
principal amount by the interest rate.
simple
compound - Answer-simple- Because simple interest is applied to the same amount of
principal each year, the amount of interest earned each year is the same, found by
multiplying the principal amount by the interest rate.
Because the nominal interest rate includes the effects of compounding, it's usually
greater than the effective interest rate.
True
False - Answer-False- Because the effective interest rate includes the effects of
compounding, it's usually greater than the nominal interest rate. And it increases even
more if interest is compounded more than once each year.
Steadfast Insurance can use the Rule of 72 to
A. Estimate how fast a principal sum doubles at a specified compound interest rate
B. Determine the rate of interest a principal sum must earn to double in a certain
number of years.
Both A and B
A only
B only
Neither A nor B - Answer-The Rule of 72 states that, for a known interest rate, under
annual compounding, the approximate number of years for a principal sum to double is
72 divided by the interest rate.The Rule of 72 can also help determine the rate of
interest a principal sum must earn to double in a certain number of years.
