Ch ( 1 )
Environment and Characteristics
* Characteristics and Types of G&NP
A. Characteristics :
Absence of Profit Motive.
Owned by Constituents ( No Stocks ).
Contributors of resources do not receive a direct share of bene
- Skills Needed at Different Managerial Levels :
* Important Managerial Skills :
Delegating Effectively ( making sure Work gets done right ).
Being an effective Communicator.
Managing Work Load/time.
Identifying clear roles for empl
B. Maximize Profit ?
Which Investment is Preferred ?
* Profit maximization may not lead to the highest possible share
price for at least three reasons :
1. Timing is importantthe receipt of funds sooner rather than later is
2. Profits do not ne
6. Simple to understand and use :
The forecasting technique should be simple to understand and use.
Users often lack confidence in forecasts based on sophisticated
techniques; they do not understand either the circumstances in which
the techniques are app
The Starting Point in Many Business Plans is to
determine the Breakeven Point.
- Cost-volume analysis focuses on relationships between
cost, revenue and volume of output.
- Use of the technique requires identification of all costs
related to the productio
Forecasting based on time-series data
* Time-Series :
A time-ordered sequence of observations taken at regular intervals
(e.g., hourly, daily, weekly,.) and the data may be measurements of
( demand, earnings, profits, ).
* Forecasting techniques based on
- Marginal Cost:of production is the change in total cost
that comes from making or producing one additional item.
Optimal decision is to continue any activity up to the point
where the marginal benefit equals the marginal cost
- Marginal Analysi
* Whats Project Scheduling ?
Project Scheduling is the process of determining how much time a
team has to complete a project in order to make it easier for the
project manager to allocate tasks.
So, many project managers rely on P
3. The Modern Mixed Economy:
An Economy in which most economic decisions from the
interaction of buyers and sellers in markets.
Efficiency and Equity:
* Productive efficiency: the situation in which a good or
service is produced at the lower possible cos
Its Important to study management for three reasons : (1) The
University of Management, which refers to the fact that managers are
needed in all types and sizes of organizations, at all organizational
levels and work areas, and in all global locations ; (
* Forming and Testing hypotheses in Economic
- A hypothesis in an economic model is a statement that
may be either correct or incorrect about an economic
- Economic Variable: something measureable that can
have different values, such as
B. Weighted Moving Average ( WMA )
Weighted average is similar to a moving average, except that it
assigns more weight to the most recent values in a time series.
* Example :-
* Note that if four weights are used, only the four most recent demands
Page No. 2 / D
is considering adding a new line of pies, which will require
leasing new equipment for monthly payment of $6,000. Variable costs will
would be $2 per pie and pies would retail for $7.
* Requirements :
A. How many pies must be sold
* What is Economy?
Anything related to the production and consumption
of goods and services.
- Scarcity: the situation in which unlimited wants exceed
the limited resources available to fulfill those wants.
- Economics: the study of the choices people mak
Q1 : Describe the four functions of management.
The Four Functions Of Management are :
A. Planning : Defining goals, establishing strategies and developing
B. Organizing : Arranging and Structuring work.
C. Leading : Working with and through people
* The Nave approach can be used with :1. Stable series
The last data point becomes the forecast for the next period. [ Ft+1 =
2. Seasonal Variation
The Forecast for this season is equal to the value of the series last
season. [ Ft+1 = At ]
3. Trend d
* Whats Forecasting ?
A statement about the future value of a variable of interest. That is,
forecasts are predictions about the future. The better those predictions,
the more informed decisions can be. ( e.g. Demand )
* Why Forecasting ?
1. Who are Managers ?
Q1 : Explain How Managers Differ From Non-Managerial
- Managers : Coordinate and oversee the work of other people so that
organizational goals can be accomplished.
- Non-Managerial Employees : Work directly on a job or tas
2. Helping managers Plan the use of the system
This refers to short-rang and intermediate-range planning which
involves tasks such as planning the inventory and workforce levels and
* Features common to all forecasts :1. Forecasting
Part I : Project Scheduling with Known Activity
Consider the Following Example :
( Related to A Floating Company )
* Note that :- Activity Column Describes :- Specific jobs or tasks that are components
of a project. Activities are represented by nod