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Assignment Should Be Submitted On or Before 23 Feb 2018. The Test Will Also Be Conducted On The Same Day

The document contains 9 questions related to operations management concepts like project scheduling, queueing models, inventory management, and economic order quantity. The questions involve calculating metrics like critical path, project duration, probability of penalties, idle time, number of customers in system, and determining optimal order quantity while minimizing total relevant costs.

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Vinu D
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75 views

Assignment Should Be Submitted On or Before 23 Feb 2018. The Test Will Also Be Conducted On The Same Day

The document contains 9 questions related to operations management concepts like project scheduling, queueing models, inventory management, and economic order quantity. The questions involve calculating metrics like critical path, project duration, probability of penalties, idle time, number of customers in system, and determining optimal order quantity while minimizing total relevant costs.

Uploaded by

Vinu D
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Assignment should be submitted on or before 23 Feb 2018.

The test will also be conducted on the same day.


1. The following table is a plan for a major freeway renovation project at an intersection of
Interstate Highway and Highway.

Expected time Immediate


Activity Description
(months) Predecessors
A Obtain Federal funding 16 -
B Obtain state funding 28 -
C Design/subcontract freeway lanes 14 A
D Design/subcontract bridges/exits 22 A
E Build new freeway sound walls 12 B,C
F Rebuild southbound lanes 26 B,C
G Rebuild transition roads/exits 18 D,E
H Build new bridges/overpasses 50 D,E
I Rebuild both bound lanes 44 F,G
(i) Draw an arrow diagram
(ii) Mark the Critical path and determine the overall project completion time
(iii) Obtain the total and free float

2. In a departmental store one cashier is there to serve the customers. And the customers
pick up their needs by themselves. The arrival rate is 9 customers for every 5 minutes and
the cashier can serve 10 customers in 5 minutes. Assuming Poisson arrival rate and
exponential distribution for service rate,
Find:
(i) Average number of customers in the system.
(ii) Average number of customers in the queue or average queue length.
(iii) Average time a customer spends in the system.
(iv) Average time a customer waits before being served.

3. The XYZ manufacturing company has determined from an analysis of its accounting and
production data for part number 625, that its cost to purchase is Rs.36 per order and Rs. 2/-
per part. Its inventory carrying charge is 18% of the average inventory cost. The demand for
this part is 10,000 units per annum. Find
(a) What is the economic order quantity?
(b) What is the optimal number of days’ supply per optimum order?
(c)Determine the time gap between successive orders.

4. A construction company is preparing a PERT network for laying the foundation of a new art
museum. Given the following set of activities, their predecessor requirements and three
time estimates of completion time:

Time estimate (weeks)


Activity Predecessors
Optimistic Pessimistic Most likely
A None 2 4 3
B None 8 8 8
C A 7 11 9
D B 6 6 6
E C 9 11 10
F C 10 18 14
G C,D 11 11 11
H F,G 6 14 10
I E 4 6 5
J I 3 5 4
K H 1 1 1

(i) Draw the PERT network


(ii) Compute the float for each activity and determine the critical path
(iii) The contract specifies a Rs. 5000 per week penalty for each week if the completion of
the project extends beyond 37 weeks. What is the probability that this company will
have to pay a maximum penalty of Rs. 15000?

5. A repairman is to be hired to repair machines, which break down at an average rate of 3


per hour. The breakdown follows Poisson distribution. Non - productive time of a machine is
considered to cost Rs.16/- per hour. Two repairmen have been interviewed. One is slow but
cheap while the other is fast but expensive. The slow worker charges Rs. 8/- per hour and
the services breakdown machines at the rate of 4 per hour. The fast repairman demands Rs.
10/- per hour and services at an average rate of 6 per hour. Which repairman is to be hired?

6. For an item, the annual demand is known to be 3000 units which are uniformly
distributed over the year. The unit cost of the item is Rs. 300 and the holding cost is 10% of
the value. It costs Rs. 450 to place an order for this product.
Determine
(i) The economic order quantity
(ii) The change in EOQ when the ordering cost changes to Rs. 600
(iii) The change in EOQ when the holding cost becomes 7.5% of the item value
(iv) Both, the ordering and the holding costs change as in (ii) and (iii)

7. A nationalized bank wishes to plan and schedule the development and installation of a new
computerized cheque processing system. The changeover in cheque-processing procedures requires
employment of additional personnel to operate the new system, development of new systems
(computer software), and modification of existing cheque sorting equipment. The activities required
to complete the project along with three time estimates and the precedence relationship among the
activities, have been determined by the bank management and are given in the following table.

Time estimate (weeks)


Activity Description Predecessors Most
Optimistic Pessimistic
likely
A Position recruiting None 5 17 8
B System development None 3 15 12
C System training A 4 10 7
D Equipment training A 5 23 8
E Manual system test B,C 1 1 1
F Preliminary system change-over B,C 1 13 4
G Computer-personnel interface D,E 3 9 6
H Equipment modification D,E 1 7 2.5
I Equipment testing H 1 1 1
J System debugging and installation F,G 2 2 2
K Equipment changeover G,I 5 11 8

(a) Draw the network diagram for this project and find the critical path.
(b) Determine the expected project duration and standard deviation.
(c) What is the probability that the length of the critical path does not exceed 40 days?

8. On a national highway, automobiles arrive for toll tax payment at an average rate of 3 in 5
minutes, according to the Poisson probability law. The attendant receives the tax in an average time
of one minute per customer. The service (collecting the tax) is exponentially distributed. Determine
(a) The percentage of time the attendant at the toll gate shall be idle
(b) The average time the attendant is free in his 8-hour duty time
(c) The probability of 0 through 5 customers in the system
(d) The expected number of customers in the system
(e) The expected number of customers waiting in the queue to pay tax

9. The annual demand of a product is 10000 units. Each unit costs Rs. 100 if the orders are
placed in quantities below 200 units. For orders of 200 or above, however, the price is Rs.
95. The annual inventory holding costs is 10 percent of the value of the item and the
ordering cost is Rs. 500 per order. Find the economic lot size. Would you suggest orders of
200 units or more? Why?

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