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CS/APR 2007/QMT337

UNIVERSITI TEKNOLOGI MARA FINAL EXAMINATION

COURSE COURSE CODE EXAMINATION TIME

: : : :

OPERATIONS RESEARCH QMT337 APRIL 2007 3 HOURS

INSTRUCTIONS TO CANDIDATES 1. This question paper consists of two (2) parts : PART A (5 Questions) PART B (5 Questions)

2. 3.

Answer ALL questions in the Answer Booklet. Answer to each question in PART B should start on a new page. Do not bring any material into the examination room unless permission is given by the invigilator. Please check to make sure that this examination pack consists of: i) ii) iii) iv) v) the Question Paper an Answer Booklet - provided by the Faculty a one - page Appendix (List of Formulae) a one - page Appendix (Standard Normal Table) a graph paper - provided by the Faculty

4.

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO

This examination paper consists of 9 printed pages
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PART A (25 MARKS)

QUESTION 1 a) b) State TWO (2) characteristics of a good model. (2 marks) Give TWO (2) advantages of using mathematical models in problem solving. (2 marks)

QUESTION 2 State whether each of the following statements is TRUE or FALSE . a) In project management, the variance of the project completion time is equal to the sum of the variances of all the activities in a project. (1 mark) The corner-point solution method in solving a linear programming problem will provide one, and only one, optimum. (1 mark) If the Economic Order Quantity assumptions are met and a company orders more than the economic order quantity, then total annual holding cost will be greater than the total annual ordering cost. (1 mark) Sequential decisions are best made using decision trees. (1 mark) e) Simulation models are designed to generate optimal solutions, which can then be applied to real-world situations. (1 mark)

b)

c)

d)

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QUESTION 3 Solve the following linear programming problem using the graphical method. Maximize z = 3x + 2y
subject to :

2x-6y 5x + 4y x + 2y y x, y

< < > < >

12 40 12 6 0
(6 marks)

QUESTION 4 An inventory system at ABC Company has the following data: Annual demand Ordering cost per order Price per unit Annual carrying cost a) = = = = 120 units RM45 RM200 24% of the unit price

Determine the economic order quantity. (1 mark)

b)

A supplier offers a 5% discount on the unit price if at least 100 units are purchased at a time. Should ABC Company take the offer? (4 marks)

QUESTION 5 Use the random numbers 98, 09, 68 and 44 to generate four random observations for the following probability distribution.

; otherwise (5 marks)

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CS/APR 2007/QMT337

PART B (75 MARKS)

QUESTION 1

a)

A publishing house publishes three weekly magazines - Daily Life, Agriculture Today and Surf's Up. Publication of one issue of each of the magazines requires the following amounts of production time and paper. Magazine Daily Life Agriculture Today Surf's Up Production (hour) 0.01 0.03 0^02 Paper (kg) 0.2 0.5 0.3

Each week the publisher has available 50 hours of production time and 3,000 kg of paper. Total circulation for all three magazines must exceed 5,000 issues per week if the company is to keep its advertisers. The selling price per issue is RM2.25 for Daily Life, RM4.00 for Agriculture Today, and RM1.50 for Surf's Up. Based on past sales, the publisher knows that the maximum weekly demand for Daily Life is 3,000 issues; for Agriculture Today, 2,000 issues; and for Surf's Up, 6,000 issues. The production manager wants to know the number of issues of each magazine to produce weekly in order to maximize total sales revenue. Formulate a linear programming model for this problem. (6 marks)

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CS/APR 2007/QMT337

b)

A clothing shop makes suits and blazers. The three main resources used are material A, material B, and labor hours. The shop has developed the following linear programming model for determining the number of suits (x) and blazers (y) to make in order to maximize profits. Maximize P = 100x + 150y (profit, RM) subject to : 10x+ 4y s 160 x + y 20 10x + 2 0 y < 3 0 0 x, y 5 0 (material A, square meters) (material B, square meters) (labor hours)

The final simplex tableau for the above problem is given below: Basis
Si X X

y 0 0 1 0

Si

s2 -16 2 -1 50

S3

RHS 20 10 10 Q

0 1 0 0

1 0 0 0

3/5 -1/10 1/10 5

y p

i)

State the optimal solution and calculate the value of Q. (2 marks)

ii)

State how much of each resource is used at the optimum production level. (2 marks)

iii)

Calculate the new profit if 2 extra square meters of material A and 2 extra labor hours were available. (1 mark) Formulate the dual problem and state its optimal solution. (4 marks)

iv)

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CS/APR 2007/QMT337

QUESTION 2

Computers Unlimited sells microcomputers to universities and colleges. The firm is able to supply the universities with computers from the following warehouses. Distribution Warehouse 1. Puchong 2. Tangkak 3. Grik Supply (No. of Computers) 420 610 340

Four universities have ordered microcomputers as follows. University A. Universiti Industri Malaysia (UIM) B. Universiti Pembangunan Malaysia (UPM) C. Universiti Cyberjaya (UC) D. Universiti Sentral Malaysia (USM) Demand (No. of Computers) 520 250 400 380

The shipping and installation costs (RM) per microcomputer from each distributor to each university are as follows: To From 1 2 3 A 22 15 28 8 17 35 21 C 30 20 16 D 18 25 14

a)

Is the above transportation problem a balanced problem? Explain. (2 marks)

b)

Solve the above transportation problem. Calculate the the minimum total cost. (11 marks)

c)

Is the solution unique? Explain. (2 marks)

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QUESTION 3 The promoter of a pop concert in Ipoh must perform the activities shown in the table below before the concert can be held. Immediate Predecessor A A A B C C C D, H E, G F, 1 Duration (days) Optimistic Most Likely Pessimistic 12 8 10 3 3 10 6 8
6

Activities A B C D E F G H 1
J

6 3 20 7 9 7 16
11

15 3 30 8 16 8 18
12 8

8
10 6 1

7 2

a)

Construct a network diagram for the above project. (7 marks)

b)

Determine the critical path and the project completion time. (2 marks)

c)

Find the earliest completion time for each of the following activities:
i) ii) Activity E Activity F

(2 marks) d) The promoter wants a 92.92% chance of completing all preparations in time for a rehearsal. How far ahead of the scheduled rehearsal date should he begin working on the project? (4 marks)

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QUESTION 4 The Semporna Manufacturing Company must decide whether to purchase a component from a supplier or manufacture the component at its plant in Melaka. If demand is high, Semporna Manufacturing could profitably manufacture the component. However, if demand is low, its unit manufacturing cost would be high due to underutilization of equipment. The following table shows the projected profit (RM'OOO) for Semporna Manufacturing's make-orbuy decision. Demand Decision Alternative Manufacture component Purchase component Low (L)
-20

High (H) 100 70

20

The company estimates the probabilities of low and high demand at 0.45 and 0.55, respectively. Semporna Manufacturing is considering conducting a market research to study the potential demand for the component. The study is expected to report either favourable (F) or unfavourable (U) conditions. The reliability of the study is given below. P(F|L) = 0.10 a) P(F I H) = 0.60

Use a decision tree to recommend the optimal strategy for Semporna Manufacturing. (14 marks)

b)

How much is the market research information worth to Semporna Manufacturing? (1 mark)

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QUESTION 5

The Iskandaria Manufacturing Company manufactures a component that has to be processed by one of two drill presses. The components are lined up in a single line and are worked on by either of the two drill presses as they become available. The components arrive at a rate of 100 per hour. Each press can process 60 units per hour. The company estimates that it costs RM2 for each hour a component spends in the queuing system. The cost of operating a press is RM6.30 an hour. Although at present, the company has 2 drill presses, the company is considering whether to install a third drill press. Make a comparison of the total hourly costs incurred by the company by operating 2 drill presses and 3 drill presses. Advise the company as to how many drill presses the company should operate. (15 marks)

END OF QUESTION PAPER

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APPENDIX 1

CS/APR 2007/QMT337

LIST OF FORMULAE 1. The Economic Order Quantity, EOQ =

2. 3. 4.

Total inventory cost, TC = C o + C h + DP Reorder point, ROP = DL Bayes'Theorem, P(A|B) = P(B | A)P(A) P(B|A)P(A) + P(B|A)P(A)

5.

Let s = number of servers i. Utilization Factor, p = ii.

M z nil
III.
IV.

ri

^(k)sf 1 "I

_pj

s!d-Pr
v. vi.

= L,4
W

'=T

vii.

Po

n<s

Pn = <

s!s n-s 6. Single server

Pn

n>s

i.

L= -

.-A.
iv.
W

W=
A. -

.-A.

q =

v.

P =

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APPENDIX 2

CS/APR 2007/QMT337

STANDARD NORMAL TABLE

Normal Curve Areas : P(Z >z) [Standard Normal Probability in right-hand tail]

z
00 01 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 30 3.5 4.0 4.5 5.0

Second decimal place ofz

.00 5000 4602 4207 3821 3446 3085 2743 2420 2119 1841 1587 1357 1151 0968 0808 0668 0548 0446 0359 0287 0228 0179 0139 0107 0082 0062 0047 0035 0026 0019 .01 4960 4562 4168 3783 3409 3050 2709 2389 2090 1814 1562 1335 1131 0951 0793 0655 0537 0436 0352 0281 0222 0174 0136 0104 0080 0060 0045 0034 0025 0018 .02 4920 4522 4129 3745 3372 3015 2676 2358 2061 1788 1539 1314 1112 0934 0778 0643 0526 0427 0344 0274 0217 0170 0132 0102 0078 0059 0044 0033 0024 0017 .03 4880 4483 4090 3707 3336 2981 2643 2327 2033 1762 1515 1292 1093 0918 0764 0630 0516 0418 0336 0268 0212 0166 0129 0099 0075 0057 0043 0032 0023 0017 04 4840 4443 4052 3669 3300 2946 2611 2296 2005 1736 1492 1271 1075 0901 0749 0618 0505 0409 0329 0262 0207 0162 0125 0096 0073 0055 0041 0031 0023 0016 .05 4801 4404 4013 3632 3264 2912 2578 2266 1977 1711 1469 1251 1056 0885 0735 0606 0495 0401 0322 0256 0202 0158 0122 0094 0071 0054 0040 0030 0022 0016 .06 4761 4364 3974 3594 3228 2877 2546 2236 1949 1685 1446 1230 1038 0869 0722 0594 0485 0392 0314 0250 0197 0154 0119 0091 0069 0052 0039 0029 0021 0015 .07 4721 4325 3936 3557 3192 2843 2514 2206 1922 1660 1423 1210 1020 0853 0708 0582 0475 0384 0307 0244 0192 0150 0116 0089 0068 0051 0038 0028 0021 0015 .08 4681 4286 3897 3520 3156 2810 2483 2177 1894 1635 1401 1190 1003 0838 0694 0571 0465 0375 0301 0239 0188 0146 0113 0087 0066 0049 0037 0027 0020 0014 .09 4641 4247 3859 3483 3121 2776 2451 2148 1867 1611 1379 1170 0985 0823 0681 0559 0455 0367 0294 0233 0183 0143 0110 0084 0064 0048 0036 0026 0019 0014

00135 000 233 000 031 7 000 003 40 000 000 287

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