Solution:

a. From given data in Table 1a:

Total no . of weeks=44

Total no . of break dow n' s=125

Probability distribution can be calculated as:
No . of possibility of event
Probability distribution=
No . of total possibility
No. of possibility of event is the value of breakdown appear in a week and no. of total possibility is the
total no. of breakdowns appear in 44 weeks.

No. of week Breakdown Probability No. of week Breakdown Probability

value Distribution value Distribution
value value
1 5 0.040 23 3 0.024
2 1 0.008 24 3 0.024
3 4 0.032 25 0 0
4 5 0.04 26 0 0
5 4 0.032 27 2 0.016
6 4 0.032 28 1 0.008
7 4 0.032 29 4 0.032
8 2 0.016 30 3 0.024
9 5 0.04 31 3 0.024
10 5 0.04 32 4 0.032
11 5 0.04 33 4 0.032
12 5 0.04 34 0 0
13 0 0 35 2 0.016
14 2 0.016 36 3 0.024
15 5 0.04 37 4 0.032
16 5 0.04 38 5 0.040
17 2 0.016 39 1 0.008
18 4 0.032 40 0 0
19 4 0.032 41 0 0
20 4 0.032 42 0 0
21 3 0.024 43 0 0
22 1 0.008 44 4 0.032
Above table is the probability distribution table for the breakdowns appear in 44 weeks.
 b. Probable break down for the next 40 weeks can be calculated as:
Random number
Probable Breakdown=
Total number of break down∈ previous 44 weeks
Total number of break down∈ previous44 weeks=125

No. of week Random Probable No. of week Random Probable

number Breakdown number Breakdown
45 46 0.368 65 38 0.304

46 81 0.648 66 68 0.544

47 19 0.152 67 87 0.696

48 90 0.72 68 65 0.52

49 73 0.584 69 76 0.608

50 88 0.704 70 11 0.088

51 56 0.448 71 4 0.032

52 7 0.056 72 40 0.32

53 57 0.456 73 49 0.392

54 92 0.736 74 8 0.064

55 14 0.112 75 74 0.592

56 31 0.248 76 21 0.168

57 42 0.336 77 22 0.176

58 28 0.224 78 10 0.08

59 61 0.488 79 98 0.784

60 52 0.416 80 30 0.24

61 79 0.632 81 97 0.776

62 36 0.288 82 1 0.008

63 91 0.728 83 33 0.264

64 35 0.28 84 54 0.432

Above is the probable breakdown table for the next 40 weeks of generator breakdown.

c. The graph of probability distribution obtained in part a is as follows:

 From the data given of 44 weeks, the maintenance department has to work more effectively in week 1,
4, 9,10,11,12,15,16,38. In these weeks generator has more probability of break down.
The graph of probable breakdown for the next 40 weeks is as follows:

 For the upcoming 40 weeks, the generator breakdown probability is more in week 48, 50, 54, 63, 67, 79
and 81. In these weeks the maintenance department has to appoint worker for instant maintenance of
generator. They have to proper schedule the checking of generator before the coming week of
breakdown probability.
Solution:
a. A-B-C analysis is used to classify the items based on their contribution in annual income. According to 70-
20-10 rule:
 A class includes those items that contribute 70% of cumulative of total consumption (¥).
 B class includes those items that contribute 20% of cumulative of total consumption (¥).
 C class includes those items that contribute 10% of cumulative of total consumption (¥).
Now we will classify the inventory based on A-B-C analysis. Inventory is based on the percentage of Total
value in $.
From given data, we will find following percentages for A-B-C analysis
Total annual number of units sold = 524000¥
Annual number of units sold
% of total unit sold= ×100
Total annaul number of units sold
Total annual consumption value = 15155350¥
Annual consumption value
% of total consumption value= × 100
Total annaulannual consumption value
Cumulative % of total consumption shows the sum of values of % total consumption in such a way second
value obtained from sum of 1st 2 values then 3rd value is sum of 1st three values and go on

Item Annual Cost Annual % of % of Total Cumulative A-B-C

number per unit Consumption total consumption % of total Analysis
of units (¥) value (¥) unit consumption
sold
Chassis 38,000 60.50 2,299,000.00 7.25% 15.17% 15.17% A

Axel 80,000 34.70 2,776,000.00 15.26% 18.32% 33.49% A

Clutch 42,000 17.00 714,000.00 8.02% 4.71% 38.20% A

Steering 20,000 42.50 850,000.00 3.82% 5.61% 43.81% A

wheel
Brake 40,000 2.00 80,000.00 7.63% 0.53% 44.34% A
Pad
Head light 72,000 37.00 2,664,000.0 13.74% 17.58% 61.92% A

Dash- 21,000 40.00 840,000.00 4.01% 5.54% 67,46% A

board
Mud flap 15,000 9.40 141,000.00 2.86% 0.93% 68.39% A

wheels 139,000 24.40 3,391,600.00 26.52% 22.38% 90.77% B

Front 15,000 46.25 693,750.00 2.86% 4.57% 95.34% C

bumper
Machine 26,000 1.00 26,000.00 4.96% 0.17% 95.51% C
screw
Rear 16,000 42.5 680,000.00 3.05% 4.49% 100% C
Bumper

Above table shows the inventory based on A-B-C analysis as well as the distribution of item on 70-20-10 rule.
b. Pareto chart is basically a bar graph which shows the relation between items and their annual number of
units sold:

Pareto chart:
c. Benefits of ABC analysis is as follows:
i. ABC analysis provides the accurate demand forecast:
It is used by inventory planners to forecast
the sales of different products and manage their inventories accordingly. This can improve your
supply chain management by lowering the cost of holding dead stock or obsolete stock.
ii. ABC analysis enhance the time management:
It assure the maximum availability of certain
commodities, the inventory staff can concentrate primarily on Category A items. This could involve
revising sales predictions, reviewing stock levels more frequently, or interacting with suppliers more
frequently to shorten lead times.
iii. ABC analysis provides strategic pricing:
You can use ABC analysis to optimize the pricing
strategy for products that bring the most value to your business. Knowing which products are in high
demand will enable you to significantly raise their selling prices and increase their profitability.
iv. ABC analysis informed supplier negotiations:
We have discovered that almost 70% of a
company's revenue comes from Category A inventory products. As you buy a significant amount of
those things, it makes good business sense to bargain with sellers for lower rates. Additionally, you
can bargain for lower down payments, free shipping, or lower prices for other post-purchase
services.
v. ABC analysis helps to develop custom inventory rules:
You can adopt specific management
tactics for each category once you've divided up all of your goods into distinct groups. For each
category, you can set different safety stock levels, service levels, and reorder levels and
specifications. Let's say you can significantly reduce costs by changing the safety stock or reordering
more category A items, and an improvement in its fulfilment rates may significantly increase overall
availability.
Solution:
a. Weighted moving average method for demand forecast is as follows:
F w 1 × Dt−1+ w 2× D t−2+w n × Dt−n
t=¿ ¿
w 1+ w 2+w 3 ….. w n

 T is the total time for demand forecast which is 6 month in our problem.
 w are the weights given above in problem.
 D is the demand of previous units given or the actual sold units.
 F is the forecast in time t.
Now put values in above formula to find demand forecast for next 6 month.
For January 2022
0.4 ×580+0.3 × 510+0.2× 450+ 0.1× 450
F jan−2022 =
0.4 +0.3+0.2+0.1

F jan−2022 =520

For February 2022:

0.4 × 520+0.3 ×580+0.2 ×510+ 0.1× 450
F feb−2022=
0.4+0.3+ 0.2+ 0.1

F feb−2022=529

For March 2022

0.4 ×529+0.3 × 520+0.2× 580+0.1 ×510
F March−2022 =
0.4+ 0.3+0.2+0.1

F March−2022 =535

For April 2022

0.4 ×535+ 0.3× 529+0.2 ×520+0.1 ×580
F April−2022=
0.4+ 0.3+0.2+0.1

F April−2022=535

For May 2022

0.4 ×535+ 0.3 ×535+0.2 ×529+0.1 ×520
F May−2022=
0.4 +0.3+0.2+0.1

F May−2022=532

For June 2022

0.4 ×532+0.3 ×535+ 0.2×535+ 0.1× 529
F June−2022 =
0.4+0.3+ 0.2+ 0.1

F June−2022 =533

These are the next six month demand forecast for the sales of leading mobile company.

Month Demand forecast using 4-month WAM

Jan-2022 520
Feb-2022 529
March-2022 535
April-2022 535
May-2022 532
June-2022 533
 b. The data given is as follows
No. Month Annual Units sold
1 Jan-2021 520
2 Feb-2021 450
3 March-2021 290
4 April-2021 570
5 May-2021 410
6 June-2021 370
7 July-2021 410
8 August-2021 370
9 Sep-2021 450
10 Oct-2021 450
11 Nov-2021 510
12 Dec-2021 580
Total unit sold = 5380

Now we will forecast the actual value by using regression model. The general equation is:
Y =ax+ b
Here a is the intercept of regression line and b is the slope.
Let X denote the number of month and Y denote the actual unit sold

(( n × ∑ XY )−(∑ X × ∑ Y ) )
slope ( b )=
¿¿
n is the total number of month which is 12

X Y X^2 Y^2 X.Y

1 520 1 270400 520
2 450 4 202500 900
3 290 9 8400 870
4 570 16 324900 2280
5 410 25 168100 2050
6 370 36 136900 2220
7 410 49 168100 2870
8 370 64 136900 2960
9 450 81 202500 4050
10 450 100 202500 4500
11 510 121 260100 5610
12 580 144 336400 6960
∑ 78 ∑ 5380 ∑ 650 ∑ 2493400 ∑ 35790
Putt all values in Summation equation
 ( ( 12× 35790 )−( 78 ×5380 ))
slope ( b )= 2
( (12 ×650 )−( 78 ) )
slope ( b )=5.73
Intercept ( a )=¿¿
Putting values in above equation

( 5380−( 5.73× 78 ) )
Intercept ( a )=
12
Intercept ( a )=411.08
Putt values in regression equation for forecasting of next 6 month

X (no. of month) Y (Actual Value) Line regression based Error

forecasting Actual-Forecasted
Y = aX + b
1 520 416.81 103.19
2 450 422.54 27.46
3 290 428.27 -138.27
4 570 434 136
5 410 439.73 -29.73
6 370 445.46 -75.46
7 410 451.19 -41.19
8 370 456.92 -86.92
9 450 462.65 -12.65
10 450 468.38 -18.38
11 510 474.11 35.89
12 580 479.84 100.16

Mean square error=MSE=¿ ¿

¿
76664.57
Mean square error=MSE=
12
Mean square error=MSE=6388.7

c.

Formula for the exponential smoothing is as follows:

 F t=α A t −1 + ( 1−α ) (F t −1 )

F tIs the demand forecasting

F t−1 Is the forecasting value of previous month compare to present month .

And At −1 is the actual value of that previous month.

For α = 0.6 and 0.3and for the month of jan-2022 the linear average is taken for first three month.

No. Month Annual Units sold Exponential Exponential

forecasting for forecasting for
α = 0.6 α = 0.3
1 Jan-2021 520
2 Feb-2021 450
3 March-2021 290
4 April-2021 570
5 May-2021 410
6 June-2021 370
7 July-2021 410
8 August-2021 370
9 Sep-2021 450
10 Oct-2021 450
11 Nov-2021 510
12 Dec-2021 580
13 Jan-2022 430 420 420
14 Feb-2022 430 426 423
15 March-2022 430 428.4 425.1
16 April-2022 430 429.36 426.57
17 May-2022 430 429.744 427.59
18 June-2022 430 428.89 428.31
19 July-2022 430 429.95 428.82
20 August-2022 430 429.98 429.17
21 Sep-2022 430 429.99 429.42
22 Oct-2022 430 429.999 429.59
23 Nov-2022 430 429.9995 429.71
24 Dec-2022 430 429.9996 429.80

Mean absolute deviation can be calculated as:

 MAD=
∑ of Error
total number of period
Error can be calculates as:
Error = Actual – forecasting value

No. Month Actual unit Exponential Exponential Error Error

sold forecasting for forecasting for for for
α = 0.6 α = 0.3 α = 0.6 α = 0.3
1 Jan-2022 430 420 420 10 10
2 Feb-2022 430 426 423 4 7
3 March-2022 430 428.4 425.1 1.6 4.9
4 April-2022 430 429.36 426.57 0.64 3.43
5 May-2022 430 429.744 427.59 0.256 2.41
6 June-2022 430 428.89 428.31 1.11 1.69
7 July-2022 430 429.95 428.82 0.05 1.18
8 August-2022 430 429.98 429.17 0.02 0.83
9 Sep-2022 430 429.99 429.42 0.01 0.58
10 Oct-2022 430 429.999 429.59 0.001 0.41
11 Nov-2022 430 429.9995 429.71 0.0005 0.29
12 Dec-2022 430 429.9996 429.80 0.0004 0.2

Sum of error for α of 0.6 = 17.6879

17.6879
MAD=
12
MAD = 1.47

Sum of error for α of 0.3 = 32.92

32.92
MAD=
12
MAD = 2.74
Solution:
An engineer graduate should have to follows the following steps for the selection and training of
industrial personnel:

 The initial stage in this procedure is to determine the precise knowledge and abilities needed for the
open positions.
 Finding the sources from which the specific skills and information can be acquired is the next stage after
identifying the specific abilities and knowledge. The necessary information and abilities can be acquired
in a variety of methods to fill the open positions. Such as:
a) Hiring seasoned personnel with the necessary training and experience is one option.
b) Second option is to send staff members to training courses where they will learn the necessary
abilities and information.
 The next step is to choose the employees who are most suitable for the open roles after the necessary
knowledge and abilities have been acquired. The personnel who are most suitable for the jobs will be
those who possess the necessary abilities and know-how as well as those who can thrive in the particular
working conditions of the manufacturing company.
 After the workers have been chosen, the subsequent stage is to give them the required training. The
workers' training needs to be tailored to teach them the specific knowledge and skills they require to
succeed in their roles.
 The workers must then be assigned to the proper jobs inside the manufacturing company after
completing their training. The workers should be assigned to tasks that will allow them to utilize their
knowledge and talents to the utmost.
 Monitoring how the employees execute in their roles is the process's last step. To make sure that the
workers are utilizing their knowledge and abilities to the fullest, their performance should be regularly
assessed.
The explanation of the above mentioned rule for the selection training and placement of skilled workers over
large scale is done as follows:
 The first step in this method is to identify the distinctive skills and knowledge needed for the open
positions.
 The next stage is to identify the resources that can be used to obtain those skills and knowledge.
 The following step was to choose employees who might make excellent candidates for the open
positions. People with the desired skills and knowledge as well as those who can function well in the
particular environment of the manufacturing company may be the best candidates for the positions.
 The following stage is to give them crucial education. The training should be created to impart to the
participants the precise skills and information required for success in their roles.
 The next phase in the production difficulty was to position them correctly. The individuals need to be
put in positions where they can utilize their skills and knowledge to the fullest.
 Monitoring the general effectiveness of the people in those positions is the last step in this process. To
ensure that employees are making the best use of their skills and knowledge, their overall performance
must be regularly assessed.