Airport Campus

Final Examination Spring Semester 2020

Subject Operations Management Program BBA

012001010
Faculty Adeel-ur-Rehman Section Code

No.of Students Maximum Marks 30 Marks

Start date & Time June 8th, 2020 Submission 12th June, 2020 at 6:00 PM
at 6:00 AM Deadline
Students should meet their submission deadline as there is no re-take or re-attempt after the deadline.

IMPORTANT INSTRUCTIONS:

Read the Instructions carefully.

1- All of your Final exam papers will be available and visible to you on June 08, 2020 at 12 am.
2- This will be a take home exam and you would have 6 days to solve your paper.
3- You can give your answers in hand written or in type-written form as per your convenience.
4- If you are giving hand written answers then you must use A4 paper sheet with sufficient margin on
left and right side.
5- You are required to solve and upload your answer file within the deadline mentioned on this question
paper.
6- Please make sure to mention your name and your registration number on top of the first page of your
answer file.
7- After solving all the answers, make the serial numbering on all your A4 answer sheets.
8- After completing a paper, you are required to make its Snap Shot (or Scan) and make its single .pdf
file by arranging all your sheets in sequence.
9- Make the file name as per given format:Subject Name (last four digits of your Registration Number)
e.g. SIM (2342).pdf “OR” QRM (2342).pdf
10- Please make sure that your pdf file is sufficiently visible and readable.
11- You must avoid any blur or dull pictures. It is recommended to use black color pen to write your
answers.
12- Don’t use pencil.
13- Upload this answer file on your respective VLE folder within the given deadline.

Page 1 of 3
 Q.No. 1 Estimated Time To Complete Question (30 Minutes) Max Marks 10

The data regarding a project is given below.

Activity Predecessors Time in weeks Cost ($) Crash

Optimistic Most Pessimisti Normal Crash Time
probable c
A - 3 3 3 800 1400 2
B - 1 4 7 1200 1900 3
C - 6 7 8 2000 2800 5
D B 3 5 7 1500 2300 4
E A 3 6 9 1800 2800 4
F A 6 9 12 600 1000 7
G B 4 6 8 500 1000 5
H C,D 2 4 6 700 1200 4
I C,D 3 5 7 1000 1700 5
J E 2 3 4 1300 2100 2
K F,G,H 5 8 11 2100 3000 6
L F,G,H 3 5 7 1600 2600 4
M I 4 6 8 1500 2300 5
N J,K 3 5 7 1200 2000 4
a. Draw a pert network. (1 Marks)
b. Find the expected duration and variance of the activity. (1 Marks)
c. Find the critical path and the expected project completion time. (1 Marks)
d. Develop an activity schedule. (1.5 Marks)
e. With how many weeks would you expect the project to be completed with 96% chance?(1 Marks)
f. Assume the company wants to complete the project within 22 weeks. What crashing decision do you
recommend to meet the desire completion time at the least possible cost? (2 Marks)
g. Develop an activity schedule for the crashed project. (1.5 Marks)
h. What added project cost is required to meet the 22weeks’ completion time? (1 Marks)

Q.No. 2 Estimated Time To Complete Question (30 Minutes) Max Marks 5

J. D. Williams, Inc., is an investment advisory firm that manages more than $120 million in funds for its numerous
clients. The company uses an asset allocation model that recommends the portion of each client’s portfolio to be
invested in a growth stock fund, an income fund, and a money market fund. To maintain diversity in each client’s
portfolio, the firm places limits on the percentage of each portfolio that may be invested in each of the three funds.
General guidelines indicate that the amount invested in the growth fund must be between 20% and 40% of the total
portfolio value. Similar percentages for the other two funds stipulate that between 20% and 50% of the total portfolio
value must be in the income fund, and at least 30% of the total portfolio value must be in the money market fund. In
addition, the company attempts to assess the risk tolerance of each client and adjust the portfolio to meet the needs of
the individual investor. For example, Williams just contracted with a new client who has $800,000 to invest. Based on
an evaluation of the client’s risk tolerance, Williams assigned a maximum risk index of 0.05 for the client. The firm’s
risk indicators show the risk of the growth fund at 0.10, the income fund at 0.07, and the money market fund at 0.01.
An overall portfolio risk index is computed as a weighted average of the risk rating for the three funds where the
weights are the fraction of the client’s portfolio invested in each of the funds. Additionally, Williams is currently
forecasting annual yields of 18% for the growth fund, 12.5% for the income fund, and 7.5% for the money market
fund. Based on the information provided, how should the new client be advised to allocate the $800,000 among the
growth, income, and money market funds? Develop a linear programming model that will provide the maximum yield
for the portfolio.

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 Q.No. 3 Estimated Time To Complete Question (20 Minutes) Max Marks 5

Bidder Distribution Hub

1 2 3 4
A 190 175 125 230
B 150 235 155 220
C 210 225 135 260
D 170 185 190 280
E 220 190 140 240
F 270 200 130 260
a. Develop the network of the problem. (1 Marks)
b. Formulate the problem as a linear programming problem. (2 Marks)
c. Solve assignment that minimizes total cost. (2 Marks)

Q.No. 4 Estimated Time To Complete Question (20 Minutes) Max Marks 5

A company makes two products (X and Y) using two machines (A and B). Each unit of X that is produced requires 50
minutes processing time on machine A and 30 minutes processing time on machine B. Each unit of Y that is produced
requires 24 minutes processing time on machine A and 33 minutes processing time on machine B. At the start of the
current week there are 30 units of X and 90 units of Y in stock. Available processing time on machine A is forecast to
be 40 hours and on machine B is forecast to be 35 hours. The demand for X in the current week is forecast to be 75
units and for Y is forecast to be 95 units. Company policy is to maximize the combined sum of the units of X and the
units of Y in stock at the end of the week.

a. Formulate the problem of deciding how much of each product to make in the current week as a linear
program. (2.5 Marks)
b. Solve this linear program graphically. (2.5 Marks)

Q.No. 5 Estimated Time To Complete Question (20 Minutes) Max Marks 5

Forbelt Corporation has a one-year contract to supply motors for all refrigerators produced by the Ice Age
Corporation. Ice Age manufactures the refrigerators at four locations around the country: Boston, Dallas, Los Angeles,
and St. Paul. Plans call for the following number (in thousands) of refrigerators to be produced at each location:
Boston 60
Dallas 75
Los Angeles 65
St. Paul 90
Forbelt’s three plants are capable of producing the motors. The plants and production capacities (in thousands) are
Denver 100
Atlanta 120
Chicago 160
Because of varying production and transportation costs, the profit that Forbelt earns on each lot of 1000 units depends
on which plant produced the lot and which destination it was shipped to. The following table gives the accounting
department estimates of the profit per unit (shipments will be made in lots of 1000 units):
Produced at Shipped to
Boston Dallas Atlanta St. Paul
Denver 7 11 8 13
Atlanta 20 17 12 10
Chicago 8 18 13 16
a. Develop a network representation of this problem. (1 Marks)
b. Formulate a linear programming model of the problem. (2 Marks)
c. Solve this problem for minimum cost. (2 Marks)

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