Problem Set # 2 Queuing Theory

1. During registration at State University every semester, students in the college of business
must have their courses approved by the college adviser. It takes the adviser an average of
2 minutes to approve each schedule, and students arrive at the adviser's office at the rate
of 28 per hour.
a. Compute L, Lq, W, Wq, and U.
b. The dean of the college has received a number of complaints from students about the
length of time they must wait to have their schedules approved. The dean feels that
waiting 10.00 minutes to get a schedule approved is not unreasonable. Each assistant
the dean assigns to the adviser's office will reduce the average time required to
approve a schedule by 0.25 minute, down to a minimum time of 1.00 minute to
approve a schedule. How many assistants should the dean assign to the adviser?
2. Game World, a video game arcade at Tanglewood Mall, has just installed a new virtual
reality battle game. It requires exactly 2.7 minutes to play. Customers arrive, on average,
every 2.9 minutes (Poisson distributed) to play the game. How long will the line of
customers waiting to play the game be, and how long, on average, must a customer wait?
3. The Riverton Post Office has four stations for service. Customers line up in single file for
service on a FIFO basis. The mean arrival rate is 40 per hour, Poisson distributed, and the
mean service time per server is 4 minutes, exponentially distributed. Compute the
operating characteristics for this operation. Indicate whether the operation appears to be
satisfactory in terms of the following: (a) postal workers' (servers') idle time; (b)
customer waiting time and/or the number waiting for service; and (c) the percentage of
the time a customer can walk in and get served without waiting at all.
4. The local Burger Doodle fast-food restaurant has a drive-through window. Customers in
cars arrive at the window at the rate of 10 per hour (Poisson distributed). It requires an
average of 4 minutes (exponentially distributed) to take and fill an order. The restaurant
chain has a service goal of an average waiting time of 3 minutes.
a. Will the current system meet the restaurant's service goal?
b. If the restaurant is not meeting its service goal, it can add a second drive-through
window that will reduce the service time per customer to 2.5 minutes. Will the
additional window enable the restaurant to meet its service goal?
c. During the 2-hour lunch period, the arrival rate of drive-in customers increases to 20
per hour. Will the two-window system be able to achieve the restaurant's service goal
during this rush period?

Problem Set No. 3 Project Management Model

1. The mill determined the activities in a CPM/PERT network that would have to
be completed and then estimated the indicated activity times, as shown in
the following table:

Construct the project network for this project and determine the following:
a. Expected activity times
b. Earliest and latest activity times and activity slack
c. Critical path
d. Expected project duration and variance
e. The probability that the mill will be fined $300,000

2. The following table provides the information necessary to construct a project network and
project crash data:

a. Construct the project network.

b. Manually crash the network to 28 weeks.
c. Compute the minimum cost

Problem Set No. 4 Decision Theory

1. Microcomp is a U.S.-based manufacturer of personal computers. It is planning to build a new
manufacturing and distribution facility in either South Korea, China, Taiwan, the Philippines, or
Mexico. It will take approximately 5 years to build the necessary infrastructure (roads, etc.),
construct the new facility, and put it into operation. The eventual cost of the facility will differ
between countries and will even vary within countries depending on the financial, labor, and
political climate, including monetary exchange rates. The company has estimated the facility cost
(in $1,000,000s) in each country under three different future economic and political climates, as
follows:

Determine the best decision, using the following decision criteria.

a. Minimin
b. Minimax
c. Hurwicz ( = .4)
d. Equal likelihood
e. Expected monetary value if probability are 0.30, 0.20 and 0.50 respectively
f. Decision Tree
g. EOL
h. EVPI

2. The Miramar Company is going to introduce one of three new products: a widget, a hummer,
or a nimnot. The market conditions (favorable, stable, or unfavorable) will determine the profit
or loss the company realizes, as shown in the following payoff table:

a. Compute the expected value for each decision and select the best one.
b. Develop the opportunity loss table and compute the expected opportunity loss for each
product.
c. Determine how much the firm would be willing to pay to a market research firm to gain
better information about future market conditions.