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Course Title: Quantitative Business Analysis Couse Code: BUS230 Semester: Summer I 2017/2018 Assignment

The document describes a linear programming problem for a furniture manufacturer that produces tables and chairs. It defines the decision variables as the number of tables (T) and chairs (C) produced. The objective is to maximize profit subject to constraints on available assembly, finishing, and inspection time. The solution is found to be T = 3.75 tables and C = 7.5 chairs, for a maximum profit of $1312.50. It also presents a simulation problem to estimate the average daily inventory cost for a store ordering refrigerators over 5 days. Random numbers are given for daily demand and order lead times. The simulation calculates ending inventory each day to find the average ordering, holding, and lost sale costs total $

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aboubakr soultan
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76 views

Course Title: Quantitative Business Analysis Couse Code: BUS230 Semester: Summer I 2017/2018 Assignment

The document describes a linear programming problem for a furniture manufacturer that produces tables and chairs. It defines the decision variables as the number of tables (T) and chairs (C) produced. The objective is to maximize profit subject to constraints on available assembly, finishing, and inspection time. The solution is found to be T = 3.75 tables and C = 7.5 chairs, for a maximum profit of $1312.50. It also presents a simulation problem to estimate the average daily inventory cost for a store ordering refrigerators over 5 days. Random numbers are given for daily demand and order lead times. The simulation calculates ending inventory each day to find the average ordering, holding, and lost sale costs total $

Uploaded by

aboubakr soultan
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Course Title: QUANTITATIVE BUSINESS ANALYSIS

Couse Code: BUS230

Semester: Summer I 2017/2018

ASSIGNMENT

Submitted to
Dr.suchi dubey
Submitted by
Omar Mohamed Almarar
201630002

QUES .1)
Given the following data and seasonal index:

(a) Compute the seasonal index using only year 1 data.

(b) Determine the deseasonalized demand values using year 2 data and year 1's seasonal
indices.

Answer:

QUES .2)

2
Swearingen and McDonald, a small furniture manufacturer, produces fine hardwood tables and
chairs. Each product must go through three stages of the manufacturing process: assembly,
finishing, and inspection. Each table requires 12 hours of assembly, 20 hours of finishing, and 2
hours of inspection. Each chair requires 4 hours of assembly, 16 hours of finishing, and 3 hours
of inspection. The profit per table is $150 while the profit per chair is $100. Currently, each
week there are 300 hours of assembly time available, 220 hours of finishing time, and 30 hours
of inspection time. To keep a balance, the number of chairs produced should be at least twice
the number of tables. Also, the number of chairs cannot exceed 6 times the number of tables.
Formulate this as a linear programming problem. Carefully define all decision variables. Find the
solution.

Answer:

Let T = number of tables produced

C = number of chairs produced

Maximize 150T + 100C

Subject to: 12T + 4C ≤ 300

20T + 16C ≤ 220

2T + 3C ≤ 30

-2T + C ≥ 0

-6T + C ≤ 0

C, T ≥ 0

Solution: T = 3.75, C=7.5, Objective function = 1312.5

QUES .3)

3
The demand for refrigerators at an appliance store adheres to the following probability
distribution:

Lead
Demand per day 0 1 2 3 4 Time 1 2
Probability 0.15 0.2 0.3 0.2 0.15 0.80 0.20
Random # 01-15 16-35 36-65 66-85 86-00 01-80 81-00

The store orders 4 refrigerators per day to have in stock to meet demand. They are trying to
maintain low inventory levels. The holding cost is $5/unit/day. The ordering cost is $20 per
order. The lost sale cost is $10/unit. A simulation is to be developed to estimate the average
daily inventory cost over 5 days. The table below shows the random numbers to be used for
refrigerator demand and lead time on orders:

demand lead time


random random
number number
day 1 88 54
day 2 27 94
day 3 32 44
day 4 36 75
day 5 54 71

Assuming that beginning inventory is equal to 5 with no prior orders in transit, what is the
overall average daily cost of inventory for the 5 days?

Answer:

Ending
Beginning Inventory Demand Inventory Order Lead time

4
day 1 5 4 1 4 1
day 2 1 1 0 4 2
Day 1’s order
day 3 4 1 3 4 1
day 4 3 2 1 4 1
Days 2’s & 3’s
day 5 9 2 7 4 1

Average Daily ordering cost = ($20*5)/5 = $20


Average Holding cost = $5(1+0+3+1+7)/5 = $12
Average Lost sale cost = $0
Total average daily inventory cost = $32

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