2

Section A [45 marks]

Answer all questions in this section.

1. Cathy and Siew Ling are trying to play a new game. Both of them have 3 choices. The pay-off matrix is as
follow.
Siew Ling
Cathy
|
|
|

\
|

2 1 3
5 2 1
4 0 2

III
II
I
III II I

(a) Determine the play-safe strategy for Siew Ling. [1 mark]
(b) Calculate the optimal mixed-strategy for Siew Ling. [4 marks]
(c) Find the value of the game for Cathy. [1 mark]

2. A manufacturer spent RM 200 000 on the monthly maintenance cost and the variable cost of a product is
estimate as RM 120 per unit. The revenue of the product is RM 200 per unit.
(a) Determine the cost function, the revenue function and the profit function. [3 marks]
(b) Find the break-even point. [2 marks]
(c) Find the profit (loss) to production level of 4000 units. [1 marks]

3. Benny borrowed RM 180 000 from a bank to set up a business. The bank charged interest in a rate of 8%
per annum on the unpaid balance, with interest compounded at the end of each month. He agreed to repay
the loan in equal monthly instalments over 10 years.
(a) Find the amount of monthly payment. [3 marks]
(b) Calculate the outstanding principle (unpaid loan balance) after he paid for 7 years (84 payments).
[2 marks]
(c) An investor would like to buy his business with RM 280 000 after 7 years, will Benny earn or lost?
How much? [2 marks]




3

4. Consider the following activity on node (AON) project network with 9 activities.

(a) Copy the diagram on your answer script and complete the earlier event time and latest event time.
[5 marks]
(b) Determine the critical path and the minimum completion time. [2 marks]
(c) If the activity E and F recorded wrongly. The correct duration for activity E and F is 6 days and 2 days
instead of 7 days and 4 days. Determine the new minimum completion time. [1 mark]

5. On the average, the daily demand for a bakery shop is 20 cakes per day are sold. A cake cost RM 80 each.
The ordering cost is RM 120 per order and the holding cost rate of 20% per cake per annum. The delivery
time of the order is 8 working days. The company will lose RM30 per cake per annum if there is the
shortage. Assume that this company operates for 360 days per year.
(a) Calculate the Economic Order Quantity (EOQ) if plan shortage is allowed. [4 marks]
(b) Calculate the maximum number of backorder. [2 marks]
(c) Determine the reorder point. [1 mark]
(d) Calculate the total annual inventory cost. [2 marks]

6. Maximize z = 8x + 9y
Subject to 3x + 2y 30 000
x + 2y 24 000
y > x
x > 2000
(a) By the graphical method, shade the feasible region for the inequalities above. [6 marks]
(b) Find the value of x and y, hence, determine the maximum value of z. [3 marks]







4
Section B [15 marks]
Answer any one question in this section.

7. Considering a project consisting the following activities, precedence relations, activities duration and
number of workers:









(a) Draw an activity on arc (AOA) for this project. Find the critical path and minimum completion
time. [8 marks]
(b) Calculate the total float for non-critical activities. [2 marks]
(c) Draw the Gantt chart and the resource histogram for the project if all activities start as early as
possible. Determine the minimum number of workers required at any given time in order for the
project to complete in minimum time. [5 marks]

8. A factory manufactures three products X, Y and Z. The manufacture of these products requires three
types of raw material, P , Q and R. The factory manager has prepared the following table.





The daily supplies of P, Q and R respectively are limited to 35 kg, 50 kg and 28 kg.
(a) Determine the linear programming model for the manufacture of the three products and hence write
it in the standard form. [4 marks]
(b) By using simplex method, find the number of units of each product should be produced daily so
that total profit obtained is maximized and determine the maximum daily profit of the factory.
[11 marks]
Due acknowledgement is given to the following sources: Past Year papers and other resource materials.
Activity Preceding activities Duration (days) Number of workers
A - 2 2
B - 4 1
C - 6 3
D B 4 3
E C 4 2
F A 6 5
G
H
I
A, D
B, E
B, E, F, G
5
2
3
3
1
1
Mass (g) required per unit of product
Raw material
X Y Z
P 2 5 2
Q 1 2 3
R 1 3 5
Profit (RM) per unit 2 1 4



5
MATHEMATICAL FORMULAE

Interest and annuity
Effective interest rate
R
eff
= (1 + i)
n
1
Future value of an annuity
( )
(

+
=
i
i
R A
n
1 1

Present value of an annuity
( )
(

+
=

i
i
R P
n
1 1


Inventory Model
For basic EOQ model
h
C
DC
Q
0
2
* =
For EOQ model with planned shortages
|
|

\
| +
=
b
b h
h
C
C C
C
DC
Q
0
2
*










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