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32OR Set2

1. The document provides instructions for a term-end examination for a post-graduate diploma in operations research. It outlines the exam format, instructions, and 4 questions to be answered. 2. The questions involve forecasting sales using different time series methods, simulation of machine processing times, queueing models of customer arrivals and service times at a petrol pump, and linear programming to minimize costs in assigning jobs. 3. Additional questions involve optimal production scheduling using linear programming, solving a transportation problem to maximize contribution, and using least squares regression to estimate home selling prices based on size.

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Niraj Bhansali
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163 views4 pages

32OR Set2

1. The document provides instructions for a term-end examination for a post-graduate diploma in operations research. It outlines the exam format, instructions, and 4 questions to be answered. 2. The questions involve forecasting sales using different time series methods, simulation of machine processing times, queueing models of customer arrivals and service times at a petrol pump, and linear programming to minimize costs in assigning jobs. 3. Additional questions involve optimal production scheduling using linear programming, solving a transportation problem to maximize contribution, and using least squares regression to estimate home selling prices based on size.

Uploaded by

Niraj Bhansali
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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MIT School of Business (MITSOB)

Post Graduate Diploma in Management (PGDM)


32nd Batch
Semester II
Term End Examination
Subject:- Operations Research
Total Marks:- 50
Duration:- 2 Hrs.
Instructions:
1) Formulate the problems in the answer sheet.
2) Students should write the steps and formulae used in the cells along with the final answer, in
the answer sheet so that examiner will be able to evaluate the answers.
3) No marks will be given in case only the final answer is written in the answer sheet.
4) Only MS Excel is to be used. No other software/packages are to be used.
5) Assume suitable data/method, if necessary and mention the assumptions, wherever made.
6) Only the text book issued, i.e., Operations Research and Quantitative Techniques by
Prof (Gp Capt) D.P. Apte is permitted to be referred during the examination. No other
material is permitted.
______________________________________________________________________________
Section A: Solve following case

(20 marks)

Q1: The president of a solar heater manufacturing company is in the business of manufacturing
solar heaters for last six years. Following data shows sales for last six years. The president is
concerned about forecasting future sales. He asked his newly appointed manager to forecast for
the seventh year. He has following observations on time series.
Year
Sales

1
1293

2
1283

3
1322

4
1355

5
1346

6
1379

1. The manager decided to use smoothing methods for forecasting. He used 2-yearly
moving average method for finding forecasted value for seventh year.
What is the forecasted value for seventh year?
2. Also he wants to find accurate method for forecasting future sales. He then used
exponential smoothing method for forecasting future value. He decided to take smoothing
constant as 0.3 and 0.7 and compare which is giving better results. Calculate forecasts
using = 0.3 and = 0.7.
Now he has three methods for comparison: 2 yearly-MA, exponential smoothing with
= 0.3 and exponential smoothing with = 0.7. Use mean absolute deviation as measure
of error. Which method out of these three is better according to you? Why? What do you
understand by measure of error in forecasting?
3. He then decided to use trend projection and compare forecasts by trend projection with
above three methods. Develop linear trend projection equation for above time series and
forecast sales for years 7th, 8th and 9th. Compare trend projection method with above three
smoothing methods.
4. Young manager observed that the sales are fluctuating as per the season. He studied the
sales of last six years as per the season. Following are the observations.
Set 2

Year
1
2
3
4
5
6

Summer
556
552
569
583
579
593

Winter
453
449
463
474
471
483

Rainy
285
282
290
298
296
303

5. Compute seasonal indices of three seasons. Comment on the seasonal indices you have
calculated.
Section B: Solve any TWO problems (9 marks each)

18 marks

Q2: A machining enterprise, True Value Machining, has two machines I and II, which are used
to process different parts. The completion time of these parts on both the machines is dynamic
and is subject to variation. Carry out simulation for 15 units, using the given random numbers
and find the average product completion time for machine I and machine II. The probabilities of
processing time of the products on both the machines are given in the following table.
Process time Machine I
(minutes)
Probability
14
.07
15
.13
16
.25
17
.31
18
.15
19
.05
20
.04

Machine II
Probability
.17
.35
.15
.14
.10
.05
.04

Following random numbers are given for Machine I and Machine II.
Unit no.
Random no.
(Machine I)
Random no.
(Machine II)

1
62
75

2
8
9
8
8

3
29
95

4
8
6
2
1

70

23

90

93

18

44

72

65

9
6
9
2
9

10

11

57

71

43

37

12

1 1 15
3 4
4 7
35
50
3 1
0 7
83
04
4 3

Q3: Arrival of two wheelers at a petrol pump for filling the petrol is considered to follow a
Poisson distribution with an arrival rate of 30 vehicles per hour. The service time for the
customer is assumed to be distributed exponentially, with service rate of 40 customers per hour.
Find
1. The utilization factor of the system.
2. The average queue length.
3. The average system length.
4. The average waiting time in a queue.
5. The average time the customer spends in a system.

6. The probability that there will be 5 customers in the system.


7. What is the probability that the customer has to wait for the service?
8. The petrol pump owner will install a second serving point when convinced that on an
arrival, a customer would expect waiting for at least 10 minutes for getting the service.
By how much should flow of customers to be increased in order to justify a second
serving point?
Q4: The head of the Software Solutions wants to assign the job of developing the software for
five companies by his five software engineers. He has trained his engineers in such a way that
anyone can develop the software for any company. The work timings are flexible, so their wages
are decided per hour. According to experience, skill, speed of the work, the hourly payment rates
are different for each of them. Amar, Aruna and Anand are working with the wages of Rs. 1500
per hour and Amruta and Atish are working with the wages of Rs. 1000 per hour. The data is
collected from the past experience and the time in hours taken by each software engineers for
developing the software are given in the following table. Determine the assignment pattern that
minimizes the total cost of development of software of five companies by these five software
engineers.
Employees
Company
Amar
Aruna
Anand
Amruta
Atish
1
33
29
40
34
44
2
23
27
45
46
50
3
34
29
38
44
48
4
31
23
38
45
43
5
36
25
36
44
45
Section C: Solve any TWO problems (6 marks each)

12 marks

Q5: A firm uses three machines in the manufacture of three products. Each unit of product I
requires 3 hours on machine A, 2 hours on machine B, and 1 hour on machine C. Each unit of
product II requires 4 hours on machine A, 1 hour on machine B, and 3 hours on machine C.
Each unit of product III requires 2 hours on machine A, 2 hours on machine B, and 2 hours on
machine C. The profit contribution of the three products is Rs. 30, Rs. 40 and Rs. 35 per unit,
respectively. Available for scheduling are 90 hours of machine A time, 54 hours of machine B
time, and 93 hours of machine C time.
1. What is the optimal production schedule for the firm?
2. What is the marginal value of an additional hour of time on machine B?
3. Suppose that the contribution margin for product I is increased from Rs. 30 to Rs. 43,
would this change the optimal production plan? Explain.
Q6: Link manufacturing company has several plants, three of which manufacture two principal
products a standard card table and deluxe card table. A new executive card table is being
introduced, which must be considered in terms of selling price and costs. The selling prices are
Rs. 1495 for Standard; Rs. 1885 for Deluxe; and Rs. 2195 for Executive. All costs at the three
plants converted as variable costs, the plant capacities and the demand are tabulated below. Solve
the problem using transportation model to maximize contribution.

Model

Quantity

Standard
450
Deluxe
1050
Executive
600
Plant Capacity

Variable Cost (in Rs.)


Plant A
Plant B Plant C
800
850
925
800

795
860
920
600

810
845
930
700

Q7: Rahul Deshpande works for a home appraisal company that is used by several local banks to
appraise the price of homes as part of the senior citizen mortgage approval process. Based on his
extensive experience with home appraisals, Rahul knows that one factor that has a direct
relationship to the selling price of a home is its size. He, therefore, wants to establish a
mathematical relationship that will help him forecast the selling price of a home, based on its
size. The table below provides information on the last 12 homes that have been sold in a specific
neighbourhood in the city where Rahul lives.
Home
No.
1
2
3
4
5
6

Selling Price Home size


(Rs. Crores)
(Sq. ft)
1.09
2010
1.36
2650
1.51
2430
1.95
2890
1.35
2550
1.89
3000

Home
No.
7
8
9
10
11
12

Selling Price
(Rs. Crores)
2.21
1.32
1.60
1.57
1.07
1.42

Home size
(Sq. ft)
3220
2370
2910
2560
2250
3410

1. Use the least squares regression method to derive a forecasting equation.


2. What is your estimate of the selling price for a house of size 3100 square feet?

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