C207 Data-Driven Decision Making Practice Questions

Correct Answer: Prescriptive

Prescriptive analytics is defined as the process by which data and analytical tools are used to provide suggestions or prescriptions to support management decisions. Descriptive analytics deals with past performance study, while prescriptive analysis infers the best course of action for the decision in advance.

Correct Answer: Relatively lower cost of computer storage

The relatively lower cost of computer storage and higher computer processing power are key reasons for increased analytics use. As technology advances, storage costs decrease and computing power increases, enabling organizations to store and analyze larger volumes of data more efficiently.

Correct Answer: By quantifying risk

Probability theory helps managers make decisions by quantifying risk. It provides tools to measure the likelihood of different outcomes, allowing managers to evaluate risks and develop strategies to mitigate them.

Correct Answer: Ordinal data

Olympic medals are examples of ordinal data because they represent categories with a clear order or ranking (gold > silver > bronze) but lack consistent intervals between categories.

Correct Answer: It reduces the amount of incomplete data

Data quality management involves reducing incomplete data and cleaning data. These processes ensure data accuracy and reliability for analysis and decision-making.