Answer the following statements true (T) or false (F)

Question

1. Evidence shows that firms that announce layoffs have higher stock prices than their peers, both in the near term and over time. 
2. Portfolio analysis is an example of the incremental model of decision making. 
3. Analytics have been used in baseball and basketball to find undervalued players that could help teams that had limited resources to pay superstars. 
4. Capital One uses predictive modeling by conducting experiments to evaluate which customers will sign up for credit cards and pay back their debt. 

Answer 1

1. FALSE
Looking at the evidence, Stanford professor Jeffrey Pfeffer finds that firms that announce layoffs actually do not enjoy higher stock prices than their peers, either immediately or over time. Layoffs also don't increase individual company productivity and, in fact, don't even reliably cut costs.
2. FALSE
Perhaps the purest application of evidence-based management is the use of analytics, or business analytics, the term used for sophisticated forms of business data analysis. One example of analytics is portfolio analysis, in which an investment adviser evaluates the risks of various stocks.
3. TRUE
Creative use of analytics enabled managers of the Oakland A's club to concentrate their limited payroll resources on draft picks who were primarily talented college players rather than veteran professionals. It also helped the Houston Rockets to select forward Shane Battier, who doesn't post many points, rebounds, assists, steals, or blocked shots but who applies a superior intelligence to an overview of the game that helps his teams produce winning records.
4. TRUE
Companies such as Capital One look well beyond basic statistics, using data mining and predictive modeling to identify potential and most profitable customers. Predictive modeling is a data-mining technique used to predict future behavior and anticipate the consequences of change.