System Dynamics Models: MCQ part I

Small System Dynamics Models

forBig Issues

Triple Jump towards Real-World Dynamic Complexity

Erik Pruyt

| | | | | | | | | | | | | | | | | || | | | | | | | | | | | | | |$| | |First time readers: start with the preface | |

Chapter 3

MCQs Part I

‘Man begreift nur, was man selber machen kann, und man fasst nur, was man selbst hervor-bringen kann.’ Johann Wolfgang von Goethe

Which of the following statements are right and which are wrong?

1. In SD, it is assumed that exogenous data largely determines system behavior.

2. The presence of a negative feedback loop means that a system always shows goal-orientedbehavior.

3. The polarity of a feedback loop is negative if it contains exactly 1 negative link polarity.

4. System Dynamicists often use soft variables to model ill-known quantitative relationships.

5. Multiple CLDs may be consistent with one and the same SFD.

6. CLDs are good devices to communicate the feedback loop structure of complex systems.

7. Black-box models with better predictive precision are always better than insight generatingglass-box models.

8. Precise reproduction of real-world system behavior is an important property of SD models.

9. Transparency is one of the most important characteristics of good SD models.

10. The desired level of aggregation of a model depends on the goal or function of the model.

11. SD models ought to comprise cognitive motives and political influences if they are important.

12. An outflow leaving a stock variable in a SFD corresponds in a detailed CLD to a negativecausal link from the outflow variable to the stock variable.

13. For material-flow systems, CLDs are better representations than SFDs because they visualizehow the material flows through feedback loops.

14. CLDs can be used to map and visualize multiple perspectives or intractable messes as longas causal assumptions can be elicited.

15. Complex issues are often characterized by more than one archetype.

68

c⃝ 2013 by Erik Pruyt WARM-UP: MCQs Part I

Multiple Choice Question 1

How many feedback loops (of each kind) are therein the SFD on the right? Hint: draw the CLD.

a. 3 negative loops and 1 positive loop

b. 1 negative loop and 3 positive loops

c. 2 negative loop and 3 positive loops

d. none of the previous answers is correct


Consider the SFD of the population submodel of a model related to prostitution and humantrafficking displayed above. Which of the following CLDs is the best aggregated CLD correspondingto this submodel?

(a) (b)

(c) (d)

| | | | | | | | | | | | | | | | | | | | | | | STOP |69

| | | | | | | | | | | | | | |$| | |

WARM-UP: MCQs Part I c⃝ 2013 by Erik Pruyt


Which of the following CLDs corresponds best to the SFD displayed above?

(a)

(b)

(c)

(d)


The unit of time in a model concerning the large-scale introduction of electrical vehicles (EVs)is expressed in month. The production capacity of a company that produces EVs is modeled as astock variable with units expressed in EV/month. The enormous growth of the expected demandfor new EVs leads to an increase of the production capacity of EVs. What unit needs to be usedfor this increase of the production capacity?

a. EV ∗ month1 ; b. EV

month ; c. ( EVmonth )

2; d. EVmonth2 .

| | | | | | | | | | | | | | | | | | | | | | | STOP |70

| | | | | | | | | | | | | | |$| | |



Consider the CLD (without loop polar-ities and link polarities) on the right.Which of the SFDs displayed below iscompatible with this CLD?

(a) (b)

(c) (d)


How many feedback loops (of each kind) are therein the SFD on the right? Hint: draw the CLD.

a. 0 feedback loop

b. 2 feedback loops

c. 4 feedback loops

d. None of the previous answers is correct

| | | | | | | | | | | | | | | | | | | | | | | STOP |71

| | | | | | | | | | | | | | |$| | |



How many feedback loops (of each kind) are therein SFD on the right? Hint: draw the CLD.

a. 1 feedback loop

b. 2 feedback loops

c. 3 feedback loops



How many feedback loops are there in the SFDon the right? Hint: draw the CLD.

a. 6 feedback loops

b. 7 feedback loops

c. 8 feedback loops

d. none of the previous answers is correct


How many feedback loops are there in the SFD displayed above?

a. 5 feedback loops b. 6 feedback loops c. 7 feedback loops d. None of the answers is correct.


At first sight, it seems as though the crisis in the euro zone hurts Germany. At closer inspection,that may not be entirely true: as the value of the German currency depends –since the introduction

| | | | | | | | | | | | | | | | | | | | | | | STOP |72

| | | | | | | | | | | | | | |$| | |


of the euro– in part on the (poor) performance of the other euro-countries, it does not increaseas much as the increase of the German exports to non-euro countries which makes the Germaneconomy ever more competitive. The doubling of the German export since 1999 is mainly dueto the dampening effect on the currency of the Euro-Mediterranean countries: German exportsto the euro zone were 55% higher in 2011 than in 2000 but have stagnated since 2007. However,exports to the ‘BRIC’ countries have increased fivefold in the same period. . . German exports toChina even grew at an average 17.7% per year between 1996 and 2011. Euro zone-wide this exportboom must have been compensated by other countries with decreasing exports or deterioratingcapital balances.

Hence, the German export miracle protects the euro from a drastic decline which would bedesirable for weakly performing euro countries, making them even less competitive. In otherwords, higher Germany exports lead to a reduction in competitiveness of weakly performing euro-countries, and conversely, the worse the performance of the weaker euro-countries is, the betterGerman exports will be. Which of the following archetypes matches this situation best?

a. Success to the successful b. Growth & underinvestment c. Fixes that fail d. Eroding goals


Suppose you must decide, as the manager of a large Dutch housing corporation, about thetypes of boilers that will be installed by the housing corporation over the next 100 years. Supposeyou can only choose from two types of boilers: High Efficiency Boilers (HE-boilers) or micro-CHPinstallations. Micro-CHP installations are still very expensive to buy, e9100 per unit (one unitcorresponds to one boiler), but recent cost reductions have been spectacular. Experience withmicro-CHP so far, 20000 micro-CHP units in total, shows that the ‘progress ratio’ equals 0.75.HE-boilers nowadays only cost e2500 because of years of experience (equivalent to 7.5 millioninstalled HE-boilers), and are characterized by a ‘progress ratio’ of 0.75 too.

The graph on the left shows a perfectprediction of the cost reduction of bothtypes of boilers if all 14 million boil-ers to be installed in the next 100 yearsby your housing corporation are eitherof the micro-CHP type (red curve) orof the HE-boiler type (green curve).The red curve is much steeper becausemicro-CHP is new and there is stillmuch room for descending the learningcurve, resulting in strongly decreasingmarginal costs.

The ‘learning curve effect’ is the relationship between production costs and the cumulativeproduction over time: the progress ratio provides insight into the cost reduction for each doublingof cumulative production. So, if a boiler has a progress ratio of 75% and it costs e10000 to producethe 1000th unit, then it will cost e7500 to produce the 2000th unit.

The red (green) curve in the graph is thus the perfectly predicted production cost per micro-CHP device (HE-boiler) if you install 100% in micro-CHP (HE-boilers) over the next 100 years.Note: the surfaces between the curves provide insight into the cumulative cost advantages of onetechnology over another.

Suppose that you are the only one installing boilers (hence, the destiny of your housing corpora-tion is fully under control), and the future is perfectly foreseeable (no surprises, perfect foresight),and discounting is not required (e1 now is worth as much as e1 in 100 years and at any time inbetween), which of the following strategies then minimizes the total investment costs over the full100 years (or 14 million boilers)?

a. 100% in HE-boilers: HE-boilers are cheaper and will always be cheaper;

| | | | | | | | | | | | | | | | | | | | | | | STOP |73

| | | | | | | | | | | | | | |$| | |


b. 100% in micro-CHP: the surface of the area to the right of the intersection point is muchlarger than the surface of the area to the left;

c. 100% HE-boilers for the first 10 years and 100% micro-CHP afterwards in order to takeadvantage of the lowest cost over the full 100 years;

d. not 100% in HE-boilers nor 100% in micro-CHP, but somewhere in between (which could becalculated), in order to take full advantage of the evolution of both technologies.


Consider the sub-model with regard to rare earth metals displayed above. Which of the followingcorresponding CLDs is the most appropriate aggregate CLD?

(a) (b) (c) (d)


Suppose there is a positive causal link from variable x to variable y, i.e. x→+ y. Someone tells youthat y increases when x increases, but also when x decreases. Which of the following statementsis true?

a. What that person says must be wrong.

b. y must be a lookup variable.

c. x must be a flow variable.

d. y must be an auxiliary variable.

| | | | | | | | | | | | | | | | | | | | | | | STOP |74

| | | | | | | | | | | | | | |$| | |



The stock exchanges of Amsterdam, Brus-sels and Paris announced in the year 2000that they would merge into Euronext. In2007, Euronext merged with the New YorkStock Exchange. The graph on the leftshows what happened in the meantimein terms of the annual number of IPOsand annual cancelations of stock marketlistings in Amsterdam, also called theDamrak. Which of the following statementsis correct?

a. In 2000 there were more companies listed on the Damrak than in subsequent years.

b. In the year 2007 there were more companies listed on the Damrak than in previous years(from 2000 on) and the following years (until the end of 2009).

c. The year 2001 was the absolute low point: In 2001, the fewest companies were listed on theDamrak over the period 2000 to 2009.

d. Either none of the above statements is correct, or all of the above statements are correct.


The European Court of Human Rights is an international court established by the EuropeanConvention on Human Rights which it needs to supervise. In spite of the fact that less than 8%of the complaints are judged admissible, i.e. the court assesses the content in less than 8% ofthe cases, and half of these remaining cases are in fact repetitive cases (similar to cases treatedpreviously), the Court has a considerable backlog with respect to complaints of citizens who believetheir human rights have been violated. Given are the graphs of the total number of new complaintsand the number of judgments summed until 1998 and for each year between 1999 and 2009. Giventhe two graphs below: How big was the backlog of pending cases at the beginning of 2010 knowingthat 2/3rd of all new complaints is immediately judged inadmissible (and therefore removed fromthe list of pending cases)?

(a) New complaints per year (b) Judgments per year

a. 11800 cases; b. 18600 cases; c. 119300 cases; d. 380000 cases.

| | | | | | | | | | | | | | | | | | | | | | | STOP |75

| | | | | | | | | | | | | | |$| | |



Consider the SFD above. Suppose that variable k is not important. Which of the following(incomplete) CLDs is the most appropriate highly aggregated CLD corresponding to the SFDabove?

(a) (b)

(c) (d)


| | | | | | | | | | | | | | | | | | | | | | | STOP |76

| | | | | | | | | | | | | | |$| | |


The CLD displayed above summarizes the structure of a model on burglaries (HB stands for Bur-glaries in Houses as opposed to Burglaries in shops and businesses, and OC stands for OrganizedCrime). Which of the following statements about possible behaviors of the model/system cannotbe explained by this causal loop diagram:

a. The number of burglaries will go down if the acceptable number of burglaries goes down.

b. If the chance of getting caught in neighboring countries goes down, so will the burglariescommitted in the Netherlands, resulting in a fewer opportunistic burglaries since there willbe fewer opportunities due to increased vigilance through media attention.

c. Organized crime has a strong interest in committing burglaries during peaks of burglariesby opportunistic burglars. The chance of being caught is lowest during these peaks since thepolice is likely to be understaffed for these peaks.

d. Opportunity burglars have good reasons to commit burglaries when the opportunity is high-est and vigilance is lowest, which is seasonal and dependent on media attention given tomany or spectacular burglaries.


The CLDs below summarize perspectives on soft drugs policy. Which of the following CLDs hasnot been drafted from the point of view of proponents of a more tolerant soft drugs policy withregard to their own perspective or to the perspective of their opponents? In other words: whichdiagram (not policy!) does not make any sense to proponents of a more tolerant soft drugs policy?

(a) (b)

(c) (d)

| | | | | | | | | | | | | | | | | | | | | | | STOP |77

| | | | | | | | | | | | | | |$| | |



How many feedback loops are there in the stock-flow diagram displayed above?

a. 2 feedback loops: 1�+ and 1�-

b. 6 feedback loops: 1�+ and 5�-

c. 7 feedback loops: 2�+ and 5�-



Both CLDs displayed above are taken from reports that are part of the Munro Review of childprotection in the UK. Systems Theory and qualitative System Dynamics were used in this reviewto examine what conditions have caused the system to become over-bureaucratized and focused oncompliance instead of an expertise-centered system focused on the safety and welfare of childrenand young persons (CYPs). Based on an improved understanding of the undesirable evolutionof the system and root causes, the final Review Report formulates proposals for reform in orderto create the necessary conditions for professionals to be able to make the best judgments aboutthe type and amount of help to be given to children and young people, as well as their families.The CLD on the left is a preliminary CLD and the diagram on the right is a simplified CLDcommunicated in the final review. What is the most important difference between these CLDs?

a. All loops in the CLD on the left are clockwise and all loops in the CLD on the right arecounter-clockwise.

b. The main dynamic hypothesis in the CLD on the right relates to endogenous HR dynamicswhereas the main dynamic hypothesis in the CLD on the left relates to the organizationalability to acknowledge errors and reflect on the success of the prescriptive approach.

| | | | | | | | | | | | | | | | | | | | | | | STOP |78

| | | | | | | | | | | | | | |$| | |


c. The dominant balancing loops in the CLD on the left cause the system to be pulled intomore and more prescription, whereas the reinforcing loops in the CLD on the right causethe system to be pushed away from less prescriptive approaches.

d. The CLD on the left consists of 3 feedback loops and the CLD on the right only consists of2 feedback loops.

Link to the answers to the 15 right/wrong questions & 20 multiple choice questions in this chapter.

Links to web based quizzes: | | | |

| | | | | | | | | | | | | | | | | | | | | | | STOP |79

| | | | | | | | | | | | | | |$| | |

Flexible E-Book for Blended Learning with Online Materials

Although this e-book is first and foremost an electronic case book, it is much more than justa set of case descriptions: it is the backbone of an online blended-learning approach. It consistsof 6 concise theory chapters, short theory videos, 6 chapters with about 90 modeling exercisesand cases, many demo and feedback videos, feedback sheets for each case, 5 overall chapters withfeedback, 5 chapters with multiple choice questions (with graphs or figures), hundreds of onlinemultiple choice questions, links to on-site lectures, past exams, models, online simulators, 126slots for new exercises and cases, and additional materials for lecturers (slides, exams, new cases).The fully hyperlinked e-version allows students (or anybody else for that matter) to learn –in arelatively short time– how to build SD models of dynamically complex issues, simulate and analyzethem, and use them to design adaptive policies and test their robustness.

ISBN paperback version:

ISBN e-book version:

Education

System Dynamics Models: MCQ part I