IIPM

Question# 1:

Answer: 4 weeks Reason / Explanation: To find the values of Late Start (LS), do a Backward pass. And to find value of Early Start (ES), do a Forward pass. Actual formula for FLOAT = LS-ES (or) LF-EF. Now, first we have to find the critical path of the network. The critical path is the longest path in the network during Forward pass. Let us see all the possible paths in the network as given below: = A+B+G+L+N = 7+3+2+2+3 = 17 w = D+I+N = 8+7+3 = 18 w = C+G+L+N = 6+2+2+3 = 13 w = D+E+G+L+N = 8+5+2+2+3 = 20 w = D+H+L+N = 8+4+2+3 = 17 w = D+J+M+N = 8+3+8+3 = 22 w = F+K+M+N = 6+7+8+3 = 24 w As critical path is the longest path of the network in forward pass, The critical path is = F+K+M+N = 6+7+8+3 = 24 weeks. Next, we find the Early Start of G, which is the maximum of the following doing Forward Pass. =A+B=7+3=10w =C=6w ES=D+E=8+5=13 weeks(maximum). Next, we find the Late Start of G by working backwards from 24 weeks up to only the start of activity G. =24-(N+L+G) =24-(3+2+2) LS=24-7=17weeks. FLOAT Formula=LS-ES =17-13=4w Therefore, Slack/Float time of activity G is = 4 weeks. Answer is = 4 Weeks

Ari

IIPM
Question# 2 :

Answer: $9,489 Reason / Explanation: Select only project Q. Initial Investment = $36,000. Interest rate, i = 10% Cumulative Present Value of all cash inflows of project Q = 5 = [ Future Value / (1+i)n] n=1 = 12,000[1/ (1+0.1)1 + 1/ (1+0.1)2 + 1/ (1+0.1)3 + 1/ (1+0.1)4 + 1/(1+0.1)5] = 12,000(.909+.826+.751+.684+.621) = 12,000(3.79) = $45,489 Net Present Value (NPV) = [ PV of inflows] Initial Investment = 45,489 36,000 = +$9,489 The answer is, NPV = $9,489

Ari