BBM511/03 Quantitative Techniques Assignment: Generative AI Perception, Regression Analysis & EMV Decision Modelling

Assignment 1

BBM511/03 QUANTITATIVE TECHNIQUES

Instructions:

1. Assignment 1 contains TWO (2) questions – Answer ALL
2. This assignment carries a total mark of 100 which is equivalent to 70% of your final total marks.
3. All the work necessary must be shown The omission of essential work will result in a loss of marks.

Part A: Development of Quantitative and Qualitative Output

Perception of Generative AI in facilitating business development in Malaysia

Generative AI in business refers to the application of artificial intelligence technology that can create new content, like text, images, or code, to automate tasks, improve efficiency, personalize customer experiences, and generate innovative ideas across various business functions, including marketing, product development, customer service, and operations, ultimately aiming to increase productivity and drive business growth; essentially, it allows businesses to generate outputs like marketing copy, design concepts, or even software code based on prompts or input data, freeing up human workforce for more strategic tasks.

In this new perspective, there are few studies conducted to understand the positive implications of generative AI towards business in Malaysia though it is between 14 to 29%. The National AI Roadmap 2021-2025 has also reported their various trends that reshape how business is conducted and affect reskilling efficiencies.

Question 1

Conduct a survey (Google form) to understand the extent of such applications, in what areas and perceptions Generative AI towards business development in Malaysia

• Collect data from business owners or consumers (minimum 30 respondents)
• Design questionnaire that measures areas of Generative AI towards business development and the business segment that Generative AI will support (minimum of 5 categorical questions)
• Design questionnaire (Likert 5 scale) to understand perception of business owners or consumers towards the perception of success of Generative AI in business minimum of 5 Likert Scale)

Generate appropriate results, analyze the empirical results and present the case (visual graphs) and summarize the overall findings through an infographic.

Reference:

• https://studyonline.sunway.edu.my/blog/8-ways-generative-ai-can-benefit-malaysian-businesses
• https://thesun.my/business-news/rise-of-generative-ai-in-reshaping-business-landscape- CB13474161

Infographic References

Source: https://theedgemalaysia.com/infographic?page=3

[40 Marks]

Part B: Regression and Predictive Modelling

Regression is a statistical method employed to examine the relationships between variables, specifically focusing on how a dependent variable changes in response to one or more independent variables. In contrast, a predictive model is a more comprehensive term that includes a range of statistical approaches designed to predict future outcomes using existing data.

Question 2

A potential entrepreneur conducted a survey on a few companies that have used artificial intelligence in their production processes. He has measured the intention to use AI against output measured by productivity gains (hours/week), cycle time reduction (mins) and innovation index (scale 1 to 10). He wanted to data mine and understood the following.

A) Study the relationship between intention to use AI with the dependent variables of productivity gains, cycle time reduction and innovation index respectively

1. 1. Visualize the each of the relationship with appropriate visuals
   2. What is the correlation (Pearson) for each Comment on it.

B) Developed a regression model with the intention to use AI with the corresponding variables.

1. 1. What is the regression determination of coefficient
   2. What is the predictive model

c) Comment on the overall

[30 Marks]

Question 3

An entrepreneur intends to evaluate whether to pilot automated generative AI software to one of the production modules. He gathers an estimated additional revenue forecast which is expected to grow over a period of 5 years. Using a decision matrix and with the assumptions below, help him to develop a decision model (EMV) and decision tree between the option of status quo (no investment) and to invest RM30,000.

Assumptions:

• The cost investment is RM30,000 for one pilot module
• The current year (year 1) revenue is RM200,000.
• The business climate The probability of a good business climate is 60% and likewise, 40% will be poor business climate.
• With additional investment, the revenue is estimated to grow 15% year over year under a good business However, under a poor business climate, the estimated revenue will only be 50% of the revenue forecasted during a good business climate. Use total 5 years revenue estimates.
• Staying status quo will cost 5% Use total 5 years revenue estimates. Use total 5 years revenue estimates.

1. Develop a decision tree
2. With the EMV model, help the entrepreneur to make an appropriate Comment on the decision.

[30 Marks]