Economic Dual Variables and Interpretations Quiz

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Questions and Answers

What does the variable $\lambda$ represent in the context of DEA optimization problem?

  • The technical efficiency ratio of DMU
  • The simultaneous reduction rate of DMU's inputs/outputs
  • The input excesses and output shortfalls (correct)
  • The virtual output value of DMU

In the CCR envelopment form, what does the variable $s_{i,r}^-$ represent in the output-oriented analysis?

  • Virtual input value of DMU
  • Simultaneous reduction rate of DMU's outputs
  • Difference between actual and ideal output (correct)
  • Contribution of DMU to the virtual output value of another DMU

What is the purpose of using the two-step procedure to identify technical and mix inefficiencies in DEA optimization?

  • To compute the slack variables efficiently
  • To estimate the virtual input and output values of each DMU
  • To assess the contribution of each DMU to the performance of other DMUs
  • To separate the technical inefficiency from mix inefficiency (correct)

What information is not explicitly provided by the CCR formulations in envelopment form?

<p>Amounts of input excesses and output shortfalls (C)</p> Signup and view all the answers

What do CCR models in multiplier form provide?

<p>Measurement of technical efficiency (B)</p> Signup and view all the answers

In DEA analysis, what do the duals of multiplier formulations help us understand?

<p>Non-radial counterparts of CCR models (A)</p> Signup and view all the answers

What is the purpose of the BCC model in envelopment form?

<p>Measurement of pure technical efficiency (A)</p> Signup and view all the answers

How can CCR and BCC radial models be extended to perform non-oriented analyses?

<p>By introducing slacks and reformulating the models (C)</p> Signup and view all the answers

In the Charnes & Cooper Transformation, what does the variable '𝑢' represent?

<p>A multiplier for the outputs weights (B)</p> Signup and view all the answers

What is the objective of the Input-oriented Analysis in the CCR Models?

<p>Maximize the sum of the input weights (A)</p> Signup and view all the answers

According to Charnes, Cooper, and Rhodes (1978), what can be learned from the duals of the multiplier formulations?

<p>The relationship between inputs and outputs (C)</p> Signup and view all the answers

What is the significance of the weights 𝑣 and 𝑢 in the CCR multiplier formulations?

<p>They reflect the contribution of each input and each output to the efficiency profile of a DMU (D)</p> Signup and view all the answers

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