Tutorial Sheet No.

– 1_Rank Coefficient of Correlation

Q1. Calculate the coefficient of correlation by using Rank Difference Method for the following three
sets of observations.
Sr. No. X Y
1 185 110
2 203 98
3 188 118
4 195 104
5 176 112
6 174 124
7 158 119
8 197 95
9 176 94
10 138 97
11 126 110
12 160 94
13 151 126
14 185 120
15 185 116

Q 2.
Sr. No. X Y
1 17 21
2 29 32
3 25 27
4 43 50
5 48 48
6 13 15
7 18 27
8 27 28
9 36 35
10 40 42
Q 3.
Sr. No. X Y
1 1 11
2 3 3
3 4 2
4 6 12
5 6 6
6 7 2
7 8 6
8 10 9
9 12 7
10 13 3

Q4.
Sr. No. X Y
1 192 110
2 203 98
3 188 118
4 195 100
5 176 112
6 174 124
7 158 129
8 192 95
9 176 94
10 138 97
11 126 110
12 160 94
13 160 121
14 185 120
15 187 116
Q 5.
Sr. No. X Y
1 17 21
2 22 32
3 25 27
4 39 55
5 48 48
6 13 15
7 18 27
8 27 32
9 39 35
10 40 55

Q 6.
Sr. No. X Y
1 1 11
2 2 3
3 4 2
4 6 12
5 6 6
6 7 2
7 8 11
8 9 9
9 12 7
10 11 3
 Tutorial Sheet No – 2 _Sales Forecasting
1. The following information gives the sales of a company for 10 months. If the smoothing factor of
0.5 is used, forecast the demand for November, if the forecast of January is 660.
Months Jan Feb Mar Apr May Jun Jul Aug Sep Oct
Sales 700 1280 840 920 1020 900 1276 1440 1610 1500

2. Given below are the quarterly sales figures of L.N.B. Co., dealing with manufacturer of small
electrical goods. Find out the seasonal index from the above data.
Rupees (in thousands)
Year 1st quarter 2nd quarter 3rd quarter 4th quarter
1970 60 162 124 238
1971 66 208 172 342
1972 84 306 198 442
1973 112 344 258 470
1974 134 402 272 604

3. “Rama & Sons” is engaged in the manufacturing of nail drivers. The management of firm thinks that
sales of nails drivers logically be related to the amount spent on construction. In the construction
volume is in Rs. 100 million units and product sales are in Rs. 10000 units.
Month 1 2 3 4 5 6 7 8 9 10
Nail driver sales *104 7.5 10 9 10.5 11.5 11 10.5 10 11.5 10.5
8
Construction volume*10 2 2.5 2 3.5 3.5 3 2.5 3 3 2.5
Month 11 12 13 14 15 16 17 18 19 20
Nail driver sales *104 10 11 9 9 12.5 11.5 11.5 10.5 911 9
Construction volume*108 2.2 3 2.5 2 3.5 3 3 3 3 2
Find out:
a) Is it worthy to consider the correlation between sales of nails and construction volume?
b) If the projected construction volume for the next month is Rs. 300000000, what would be sales
volumes of the nails in rupees?
4. Below are given figures of sales of a sugar mill. Compute the sales estimates for the year 1980 by
straight line trend method. If an analysis of buisness conditions and pertinent economic factors
indicate that sales in 1980 will be about 20% below trend or normal, then what will be the sales in
1980. The sales figures are:

Year 1968 1969 1970 1971 1972 1973 1974 1975

Sales (In lacs) 80 90 92 83 94 99 92 110

5. Given below is the sales pattern of ABC Company, manufacturing consumer goods. Trend of
consumption of consumer goods in the market is also depicted. Find out the correlation between the
sales of the company and the consumption of goods in the market. Also compute the estimates of sales
when the consumption in the market will rise to 20 lakhs.
Sales (Rs. Lakhs) X 1 2 3 4 5 6 7 8 9
Consumption of goods in the market (Rs. Lakhs) Y 9 8 10 12 11 13 14 16 15

6. The sales of consecutive three years of an industry are shown below. If the forecast for the year 1988
is Rs. 1,60,000, then divide the product group and find the forecast for the product “X” for the year
1988.

Year Product Group Sales Product “X” Sales Sales of product “X”
1985 1,20,000 24,000 20%
1986 1,25,000 26,250 21%
1987 1,40,000 30,800 22%
 Tutorial Sheet No – 3_Single Facility Location
Qn. 1. A new plant needs to be established to receive raw materials from 3 suppliers, P, Q and R
and to supply finished products to three warehouses, U, V, and W. Sources of raw materials and the
destination points may be considered as existing facilities. The coordinates of existing facilities and
the amount of material movement between existing facilities and the new facility are shown as
under:

Coordinates of i Material movement to

Existing facility (i)
Xi Yi new facility (wi)
P 400 300 600
Q 200 500 400
R 300 100 500
U 100 550 300
V 500 400 600
W 350 600 600

Find the optimal location and optimal cost of new facility.

Qn. 2. Find the optimal location and cost of new facility, assuming rectilinear distance among
facilities, from the given table.

Coordinates of i Material movement to

Existing facility (i)
Xi Yi new facility (wi)
P1 4 4 3
P2 4 11 2
P3 7 2 2
P4 11 11 4
P5 14 7 1

Qn. 3. Solve the Question no. 2 by using squared Euclidean method.

Qn. 4. There are four hospitals in a city that require blood from one central facility. Locations of four
hospitals are as follows:

Coordinates of i Material movement to

Existing facility (i) new facility (wi)
Xi Yi
P1 5 10 450
P2 7 8 1200
P3 4 2 300
P4 16 3 1500

Assume rectilinear distance and find the optimal location. What assumption must be made about the
delivery of blood? Is it justified?
 Tutorial Sheet No. – 4_Inventory Control
1. A company requires 16,000 units of raw material costing Rs.2/- per unit. The cost of pacing an
order is Rs.45/- and the carrying costs are 10% per year per unit of average inventory.
Determine a) The economic order quantity b) Cycle time c) Total variable cost of managing the
inventory.
2. ABC manufacturing company needs 2880 ball bearings per year. The cost of placing an order
is Rs.48/- and inventory carrying cost, as a percentage of average inventory investment is 12%.
Determine a) Value of each assignment b) Number of orders per year.
3. A company needs 600 units per month; the procurement cost is Rs.36 per order; the cost of
holding it in stock is Rs.1.20/- per unit per year. Determine the quantity that should be procured
at a time to optimise the cost involved. If the consumption of the above increases to 40 per day
and its actual inventory cost is Rs.0.50/unit per month, what will be the revised EOQ. Assume
300 days in one year.
4. A firm needs 200 units/month. The cost of placing an order is Rs.40. in addition to Rs.0.50, the
carrying costs are 10% per unit of average inventory per year. The purchase price is Rs.10/-
per unit. Find the economic lot size to be ordered and the total minimum cost.
5. A manufacturer purchases items in lots of 800 units, which is a four-month requirement. The
cost per unit is Rs.100/- and the ordering cost is Rs.120/- per batch per order. The inventory
carrying cost is estimated as 20% of the average inventory investment. Determine the annual
variable cost managing the inventory and how much saving can be obtained from the EOQ
purchase.
6. A company requires 16,000 units of raw material costing Rs.2/- per unit. The cost of pacing an
order is Rs.45/- and the carrying costs are 10% per year per unit of average inventory.
Determine a) The economic order quantity (b) Cycle time
(c) Total variable cost of managing the inventory.
7. ABC manufacturing company needs 28,800 ball bearings per year. The cost of placing an order
is Rs.48/- and inventory carrying cost, as a percentage of average inventory investment is 12%.
Determine a) Value of each assignment b) Number of orders per year.
8. A company needs 600 units per month; the procurement cost is Rs.36 per order; the cost of
holding it in stock is Rs.1.20/- per unit per year. Determine the quantity that should be procured
at a time to optimise the cost involved. If the consumption of the above increases to 40 per day
and its actual inventory cost is Rs.0.50/unit per month, what will be the revised EOQ. Assume
300 days in one year.
9. A firm needs 200 units/month. The cost of placing an order is Rs.40. in addition to Rs.0.50, the
carrying costs are 10% per unit of average inventory per year. The purchase price is Rs.10/-
per unit. Find the economic lot size to be ordered and the total minimum cost.
10. A manufacturer purchases items in lots of 800 units, which is a four-month requirement. The
cost per unit is Rs.100/- and the ordering cost is Rs.120/- per batch per order. The inventory
carrying cost is estimated as 20% of the average inventory investment. Determine the annual
variable cost managing the inventory and how much saving can be obtained from the EOQ
purchase.
 Tutorial Sheet No. – 5_ Safety Stock
1. The average monthly consumption for an item is 300 units and the normal lead time is 1 month.
If the maximum consumption has been up to 370 units/ month and maximum lead time is 1.5
months, what should be the buffer stock for an item?
2. A firm uses every year 12000 units of a raw material costing Rs. 1.25/ unit. Ordering cost is Rs.
15 / order and the holding cost is 5% / year of average inventory. (i) Find the economic order
quantity. (ii) The firms follow E.O.Q purchasing policy. It operates for 300 days / year.
Procurement time is 14 days and safety stock is 400 units. Find the reorder point, the maximum
inventory and the average inventory.
3. Calculate the various parameters for putting an item with following data on E.O.Q system:
Annual consumption=12000 units at the cost of Rs. 7.50 / unit.
Set up cost=Rs. 6 and inventory holding cost=Re. 0.12 / unit.
Normal lead time =15 days and maximum lead time =20 days.
4. The following information is provided for an item:
Annual usage=12000 units, ordering costs=Rs. 60/order, carrying costs 10%, unit cost of an
item= Rs. 10 and lead time =10 days.
There are 300 working days / year. Determine E.O.Q and the number of orders / year. In the
past two years the use rate has gone as high as 70 units / day. For a reordering system based
on the inventory level, what should be the safety stock? What should be the reorder level at this
safety stock? What would be the carrying costs for a year?
5. An automobile company has determined that 16 spares engines will result in a stock-out risk of
25% while 20 will reduce the risk to 15% and 24 to 10%. If the lead time is 3 months and the
average usage is 6 engines/ month, what should be the R.O.L to maintain 85% service level?
6. A firm has a normally distributed forecast of usage with MAD=60 units. It desires a service
level; which limits stock-outs to be one order cycle / year.
(i) How much safety stock will be kept if the order quantity is normally a week’s supply?
(ii) What will be the safety stock if the order quantity is 4 weeks’ supply?
7. The average demand for an item is 120 units/ year. The lead time is 1 month and the demand
during lead time follows normal distribution with average of 10 units and the standard
deviation of 2 units. If the item is ordered once in 4 months and the policy of the company is
that there should not be more than 1 stock-out every two years, determine the reorder level.
8. A look at the past records gives the following distribution for lead time and daily demand
during lead time:
Lead time distribution
Lead time (days) 0 1 2 3 4 5 6 7 8 9 10

Frequency 0 0 1 2 3 4 4 3 2 2 1
Demand rate distribution
Demand / day (units) 0 1 2 3 4 5 6 7

Frequency 3 5 4 5 2 3 2 1
What should be the buffer stock?
9. The demand per month for a product is normally distributed with a mean of 100 and standard
deviation 25. The lead time distribution is given below. What service level will be afforded by
reorder level of 500 units?
Lead time ( months) Probability
1 0.10
2 0.20
3 0.40
4 0.20
5 0.10
10. A company ahs compiles the following information regarding a component it wants to
purchase:
The average usage is 120 units / day with standard deviation of 50 units / day based on the
plant operating for 250 days /year. The acquisition cost per order is Rs. 20. Inventory holding
cost is re. 1 / unit / year and the acquisition lead time is constant at 10 days. The company has
determined the allowable stock-outs / year to be one. Using the information, determine:
(i) The economic order quantity
(ii) The required safety stock and the reorder level.
 Tutorial Sheet No. – 6_Sequencing
1. A machine operator has to perform two operations, turning and threading on various jobs. The
time required to perform these operations (in min.) for each job is known. Determine the order in
which the job should be processed in order to minimize the total time required complete the
operations. Also find total processing time and idle times for turning and threading and show on
the Gantt chart.

Job 1 2 3 4 5 6
Time in Turning 3 12 5 2 9 11
Time in threading 8 10 9 6 3 1

2. There are seven jobs, each of which has to go through the machine A and B in the order of AB.
Processing times in hours are given as:
Jobs 1 2 3 4 5 6 7
Machine A 3 12 15 6 10 11 9
Machine B 8 10 10 6 12 1 3
Determine the sequence of these jobs that will minimize the total elapsed time. Also find total time
and idle time for machines, A and B.
3. A machine operator has to perform 3 operations, turning, threading and knurling on a number
of different jobs. The time required to perform is given in minutes for each job. Determine the order
in which the jobs should be processes in order to minimize the total time required to complete all
the jobs. Also find idle time for three operations and show on Gantt. chart.
Time for
Time for threading Time for Knurling
Jobs turning (in
(in min.) (in min.)
min.)
A 3 8 13
B 12 6 14
C 5 4 9
D 2 6 12
E 9 3 8
F 11 1 13
4. Find the sequence of following 7 jobs that will minimize the total elapsed time for the completion of
all the jobs. Also find processing and idle time for all the three machines. Processing times (in min.)
are given the following Table.

Jobs I II III IV V VI VII

Machine A 3 8 7 4 9 8 7
Machine B 4 3 2 5 1 4 3
Machine C 6 7 5 11 5 6 12

5. Find the sequence that minimizes the total elapsed time required to complete the tasks. Each task is
processed in any two of the machines, A, B and C in any order. Find optimal sequence and optimal
elapsed time.
Tasks Machine A Machine B Machine C
I 12 7 3
II 6 8 4
III 5 9 11
IV 3 8 5
V 5 7 2
VI 7 8 8
VII 6 3 4

Qn. 6 Solve the given problem by using SPT rule. Find the sequence, mean flow time, WMFT, average
inventory, mean lateness, mean tandiness and no. of tardy jobs.
Jobs 1 2 3 4 5
Processing time 5 4 2 6 10
Weighage 1 2 1 3 5
Due date 10 10 20 5 6

Qn. 7. Solve the question no. 6 by using WSPT rule and find all the parameters asked in Qn. 6.
Qn. 8 Solve the Question no.6 by using EDD and STR rules and find all the parameters asked in Qn. 6.
Qn. 9 Find the optimal sequence, completion time of all the jobs, MFT, WMFT, Average in-process
inventory, mean, minimum and maximum latesness, mean tandiness and no. of tardy jobs , using SPT,
WSPT, FCFS & EDD methods . Which method will you suggest to implement?

Jobs 1 2 3 4 5 6 7 8
Processing
5 8 6 3 10 14 7 3
time (in Min.)
1
Weighage 1 2 3 1 2 3 2

50
Due dates 15 10 15 25 20 40 45

Qn. 10 There is a requirement to locate six machines in a machine shop. The amount of material
movement between facilities, i and j is given in matrix.

i↓ j → 1 2 3 4 5 6
1 0 5 8 0 10 2
2 0 0 8 3 7
3 0 0 1 5
4 0 0 1
5 0 7
6 0
The available floor space for lying out the machines is;
1 2 3
4 5 6

All the available locations are identical in shape and the distance moved between two adjacent
machines may assume to be unity. How will you assign the machines to available locations so as to
minimize the total cost? Assume that the material handling cost is proportional to the product of the
amount of material moved and the distance of movement.
 Tutorial Sheet No. – 7A - PERT & CPM-I
1. Draw a network for simple project of execution of steel works for a shed.

Activity A B C D E F G H I J K
Prerequisites - - A B A B C, D G, F E H, I J

2. Draw the network of given activities in logical sequence.

Activity A B C D E F G I J K
Immediate successor B L D E L G E J L L

3. To start a factory in a building available in industrial area, the various activities and their
timings are shown in the following table. Draw the A-O-A network and calculate EST, LST,
EFT, LFT and Total Float. Mark the critical path and find total project duration.
Activity Particulars Time in days
A M/c foundation 10
B Electric fitting 15
C Repair of floor 20
D Installation of m/c 12
E Procurement of workshop 15
F Building whitewash 5
G Cleanup 2

4. A small engineering project consists of six activities. Three time estimate in number of days for
each activity is time given below:
Activity To Tm Tp
1-2 2 5 8
2-3 1 1 1
3-5 0 6 18
5-6 7 7 7
1-4 3 3 3
4-5 2 8 14
(a) Calculate the values of expected time (Te), standard deviation & variable allowance (Vi) for
each activity.
(b) Draw the network A-O-A.
(c) Calculate EST, LST, LFT, EFT and slack.
(d)The probability of completion of project in 32 days.
5. For the network shown below, the time estimates in days for activity are indicated on the
diagram. Determine:
a) Expected time & variance for each activity.
b) Total project duration & critical path.
c) The probability of completion of project in 32 days.

2 4-7-10
6-9-18
1 4-7-2 4 5
4-10- 22
3
5-8-17 1-7-16
2-5-8
 Tutorial Sheet No. – 7B_Crashing of Network
Qn. 1. List of activities for erecting a canteen in a factory is given below with other relevant details. Job A must precede all
others while job E must follow others. Apart from this, jobs can run concurrently.
Normal Duration Normal Duration
Code Job Description Cost (Rs.) Cost (Rs.)
Days Days
Lay Foundation & Building
A 5 3000 4 40
Walls
B Tile Roofing 6 1200 2 20
C Install Electricity 4 1000 3 18
D Install Plumbing 5 1200 3 20
E Connect Services To Finish 3 1600 3 16

(i) Draw the network & identify the critical path.

(ii) Crash the network fully to find out max. duration.
(iii) If indirect costs are Rs. 300 per day, determine time-cost trade off the project.
Qn.2. In the following table gives data on normal time & cost & crash time & cost for a project:
Normal Duration Normal Duration
Activity Cost (Rs.) Cost (Rs.)
Days Days
1-2 6 60 4 100
1-3 4 60 2 200
2-4 5 50 3 150
2-5 3 45 1 65
3-4 6 90 4 200
4-6 8 80 4 300
5-6 4 40 2 100
6-7 3 45 2 80

The indirect cost is Rs. 40 per day.

(i) Draw the network for the project
(ii) Find the critical path
(iii) Determine the minimum cost and optimum duration.
Qn.3. the following table gives data on normal time & cost & crash time & cost for a project:
(i) Draw the network & identify the critical path.
(ii) What is the normal project duration & associated cost.
(iii) Find out the total float for each activity.
(iv) Crash the relevant activities systematically & determine the optimum project time & cost.
 Normal Duration Normal Duration
Activity Cost (Rs.) Cost (Rs.)
Days Days
1-2 3 300 2 400
2-3 3 30 3 30
2-4 7 420 5 580
2-5 9 720 7 810
3-5 5 250 4 300
4-5 0 0 0 0
5-6 6 320 4 410
6-7 4 400 3 470
6-8 13 780 10 900
7-8 10 1000 9 1200

Indirect costs are Rs. 50/ week

Qn. 4 The following is the table, showing details of a project:
Immediate Normal Cost Normal Cost
Task
Predecessor Time(Weeks) (Rs. Thousand) Time(Weeks) (Rs. Thousand)
A - 10 20 7 30
B - 8 15 6 20
C B 5 8 4 14
D B 6 11 4 15
E B 8 9 5 15
F E 5 5 4 8
G A,D,C 12 3 8 4

Indirect cost is Rs. 400 per day. Draw A-O-A network, Mark CP and calculate total project duration. Find the optimum
duration and associated minimum cost.

Qn. 5 As the project manager of a Construction Co., you are involved in drawing a PERT network for laying the
foundation of a new art museum. The relevant information for all the activities of the project is given in the table.
 Time Week Estimate Normal Cost for
Crash Cost Immediate
Activity Expected Duration
To Tm Tp (Rs.) Predecessor
(Rs.)
A 2 3 4 6000 8000 -
B 4 5 6 12000 13500 A
C 3 5 7 16000 22000 A
D 2 4 6 8000 10000 A
E 1 2 3 6000 7500 C,D
F 1 3 5 14000 20000 B,E

(i) Construct the AOA network and determine the critical path and the expected duration of the project.
(ii) The director of the Company wants that the project must be completed by seven weeks and refers to the penalty clause
@ Rs. 2500 for every week or part there of exceeding seven weeks. Determine the optimum duration of project if your
objective is to minimize the sum of project execution cost and the penalty cost.
 Tutorial Sheet No. – 8_Reliability
1. A certain type of electric component has a uniform failure rate of 0.00001 per hours. What is its
reliability for a specified period of service of 1000 hours?
2. The following reliability has been set on the subsystem of a communication system. Find the reliability
of complete system.
S. No. Subsystems Reliability ( for a 4 hour period)
1. Receiver 0.97
2. Control Systems 0.989
3. Power Supply 0.995
4. Antenna 0.996

3. It is desired to have a reliability of at least 0.99 for a specified service period of 1800 hours, can an
assumption of a uniform failure rate, what is least value of Ө that will yield this desired reliability?
4. An equipment is subjected to a maintenance time constraints of 30 minutes. What is the probability that
it will met the specifications if MMRT is 0.262 hrs?
5. An acceptance sampling plan for life testing requires that sample of 40 items to be tested with
replacement of 500 hrs if more than 5 of these items fail, the lot is accepted otherwise it is rejected.
 Assuming that failure rate is constant, compute the mean life for which the producers risk of lot
rejection is 0.05.
 Compute the mean life for which the consumer’s risk of lot acceptance is 0.10.
6. In the qualification test, which requires 418000 items hours of test, has an acceptance number of 3.
 Approximately what mean life in hours corresponds to a producer’s risk of 0.05?
 Mean life for a consumer’s risk of 0.10.
7. In testing of 1000 components, number of failures for a period of time is given. Compute failure density,
failure rate and reliability for each period.
Hours 0 1 2 3 4 5 6 7 8 9 10
Failures 0 155 148 128 124 92 88 82 78 65 40

 Compute the expected life of components up to 10th hours.

 Compute the expected life of old ones after 5th hour.