G.H.

RAISONI SCHOOL OF BUSINESS MANAGEMENT

Sessional Examination 2009-10
Third Semester Master of Business Administration
Paper-I: Applied Operation Research
Time:- 3 Hours
Max.Marks: 80
1)Attempt Five Questions
2)At least Two Questions from each section are compulsory.
3)All questions carry equal marks.
SECTION A
Q.1.A steel company is negotiating with its union for revision of wages to its employees. The
Management with
the help of a mediator,has prepared a payoff matrix shown below. Plus sign represents wage
increases, while
negative sign stand for wage decreases. Union has also constructed a tabel which is comparable to
that developed by the management. The management does not have the specific knowledge of game
theory to the best st-rategy or strategies for the firm. You have to assist the management on the
select
problem. What
game value and strategies are available to the oposing group?

OR
Q.1 What is Game Models? Explain its Terminology?
Q.2. A Management students identifies the following list of activities and sequencing along with the
time estimates
for various activites related to the completion of his project.

a. Construct the Project Network.

b. Find the Expected duration and Variance of each activity.
c. Find the Critical Path and the Expected Project completion time.
d. What is the Probability of completing the project on or before 35 days?
Q.3. The Following is a table showing details of a Project:-

Indirect Cost is Rs.400 Per Day

Find the optimum duration and the associated minimum Project Cost.

Q.4. A company is considering the purchases of new machine at Rs.15000. The economic life of the economic
life of the machine is expected to be 8 years. The salvage value of the end machine at the of the life will be
Rs. 3000. The annual runing costs are estimated to be Rs. 7000.
a. Assuming an interest rate of 5% determine the present worth of future costs of the proposed machine.
 b. Compare the new machine with the presently owned machine that has an annual operating cost Rs.5000
and cost of repair Rs.1500 in the second year with an annual increases of Rs.500 in the Subsequent years
Q.5. The Failure rates of 1000 street bulbs in a colony are summarized in table.

The cost of replacing on indivudual bulb is Rs.60. if all the bulbs are replaced simultaneouly it would
cost Rs.25 per bulb.
i) Replace the bulbs individually when they fail.
ii)Replace all the bulbs simultaneoulsy at fixed intervals and replace the individual bulbs as
and when they fail in service during the fixed interval.
SECTION B
Q.6.a) Find an optimal sequence for the following sequencing problem four jobs and five machines
when passing is not allowed of which processing time (in hours) is given below:-

Q.6.b) Find the sequence that minimizes the total elapsed time required to complete the following
tasks an two machines.

Q.7. A firm has a single channel service station with the following arrival and service time probability distribution.
Inter Arrival Service Time
Time(Minutes)
Probability Probability
(minutes)
10 0.1 5 0.08
15 0.25 10 0.14
20 0.3 15 0.18
25 0.25 20 0.24
30 0.1 25 0.22
30 0.14
the customer's arrival at the service station is random phenomenon and the time between the
arrival varies from 10min to 30min. The service time varies from 5min to 30min. The queuing
process begins at 10.am and proceeds for nearly 8 hours. An arrival goes to the service facility
immediately if it is free otherwise it will wait in a queue. The queue discipline is first-come first
served. If the attendent wages are Rs.10 per hour then wourld it be an economical proposition
to engage a second attandent? Answer using Monte Carlo Simulation Technique.

Q.8. A backery keeps stock of a popular brand of cake, previous experience shows the daily demand pattarn
for the item with associated probabilities as given below:-

Use of the following sequence of random numbers to stimulate the demand for next 10 days.
Random No. 25 39 65 76 12 05 73 89 19 49
Also estimate the daily average demand for the cakes on the basis of stimulated data.

Q.9. Alpha logistic company has to load a cargo out of four items whose details are shown in table.
The maximum weight of the cargo is 7 tons. Find the optimal cargo loading using dynamic -
Programming method such that the total return is maximized.

Q.10. Recent developments in the field of computer technology have enable operation research to integrates its
models into informations system and thus make itself a part of decision-making procedures of many
organisation. Comment.
 Immediate Activity Time (days)
Activity Description
Predecessor Optimistic Likely Pessimistic
A Search of literature - 2 6 9
B Deciding the Project - 2 4 12
C Preliminiary Work B 1 1.5 5
D Formal Proposal C 1 2 3
E Project Committee's Approval A,D 1.5 2 4.5
F Progress Report E 0.5 1 1.5
G Formal Research A,D 4.5 5 11.5
H Data Collection E 2 5 8
I Analysis G,H 4 5.5 10
J Conclusion I 1.5 2.5 4.5
K Draft I,F 2 3.4 8
L Final Draft J,K 2.5 3 1.4
M Presentation L 0.5 1 1.5

a. Construct the Project Network.

b. Find the Expected duration and Variance of each activity.
c. Find the Critical Path and the Expected Project completion time.
d. What is the Probability of completing the project on or before 35 days?
Ac
 Immediate Normal Crash
Activity
Predecessor
Time(weeks) Cost(Rs.000) Time(weeks) Cost(Rs.000)
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
Find the optimum duration and the associated minimum Project Cost.

MACHINE
JOB
M1 M2 M3 M4
A 7 5 2 3
B 6 6 4 5
C 5 4 5 6
D 8 3 3 2
 Additional cost to s
Union strat

Company strategies

C1
C2
C3
C4

Immediate Activity Time (days)

Activity Description
Predecessor Optimistic
A Search of literature - 2
B Deciding the Project - 2
C Preliminiary Work B 1
 D Formal Proposal C 1
E Project Committee's Approval A,D 1.5
F Progress Report E 0.5
G Formal Research A,D 4.5
H Data Collection E 2
I Analysis G,H 4
J Conclusion I 1.5
K Draft I,F 2
L Final Draft J,K 2.5
M Presentation L 0.5

Immediate Normal Crash

Activity
Predecessor Time(weeks) Cost(Rs.000) Time(weeks)
A - 10 20 7
B - 8 15 6
C B 5 8 4
D B 6 11 4
E B 8 9 5
F E 5 5 4
G A,D,C 12 3 8
 Item (i) 1 2 3
Weight (wi)/Unit (in tons) 2 1 4
Return (ri)/Unit (in rupees) 1000 400 2100
 Failure Rates of Street Bulbs
End of Month 1 2 3 4 5 6
Probability of failure to
0.05 0.2 0.4 0.65 0.85 1
date

Item (i) 1 2 3 4
Weight (wi)/Unit (in tons) 2 1 4 3
Return (ri)/Unit (in rupees) 1000 400 2100 1400

M5
9
10
8
6

MACHINE
JOB
 JOB
M1 M2
A 7 5
B 6 6
C 5 4
D 8 3

Additional cost to steel company

Union strategies TASK A B
MACHI
U1 U2 U3 U4 2 5
NE-1
MACHI
2.5 2.7 3.5 0.2 6 8
NE-2
2 1.6 0.8 0.8
11.4 1.2 1.5 1.3
3 1.4 1.9 0

Activity Time (days)

Likely Pessimistic
6 9
4 12
1.5 5
 2 3
2 4.5
1 1.5
5 11.5
5 8
5.5 10
2.5 4.5
3.4 8
3 1.4
1 1.5

Crash
Cost(Rs.000)
30
20
14
15
15
8
4
 4
3
1400
 Inter Arrival Service Time
Probability Probability
Time(Minutes) (minutes)
10 0.1 5 0.08
15 0.25 10 0.14
20 0.3 15 0.18
25 0.25 20 0.24
30 0.1 25 0.22
30 0.14

MACHINE
M3 M4 M5
2 3 9
4 5 10
5 6 8
3 2 6

C D E F G H I
4 9 6 8 7 5 4
7 4 3 9 3 8 11