FACULTY OF MANAGEMENT STUDIES

UNIVERSITY OF DELHI
MBAEX I year I Semester Examination, January 2021
Unique paper Code: 410921102
MBAEX 8102: Data Analysis and Optimization
Time: 3 hours Maximum marks: 70

NOTE: This question paper has two sections. Answer any FIVE questions selecting at least
TWO questions from each section. All questions carry equal marks.

SECTION A

1. A dealer in used car would sell a 2018 make SUV Tornado. It collected data from other dealers
of used cars and found 20 recent sales of similar cars, with the following final selling prices.

4050 3750 3100 4540 1800 4400 3995 3670 5000 3900

3730 4130 4005 2100 4120 4200 4540 3775 3700 4180

(i) Suppose the dealer wants a quick sale. What should their approximate price be if it is willing
to let the car go at approximately the 10th percentile?

(ii) Now suppose the dealer would like its car's sale price to reflect the central tendency of the
population of similar cars that are sold. Is there anything exhibited by these data that might
make the median preferable to the mean with respect to setting a final sale price?

(iii) Draw a box-and-whisker plot for the data.

2.(a) The makers of Swadist chocolates sell their choco-candy by the box. Based on company policy,
the mean target weight of all boxes is 200 grams. To make sure that they are not putting too much
in the boxes, the manager wants no more than 3 percent of all boxes to contain more than 210
grams of choco-candy. In order to do this, what should the mean fill weight be set to if the fill
standard deviation is 0.13 grams? Assume that the box weights are normally distributed.

(b) A study conducted for a health department in a city indicated that among the visitors to their
health and wellness centers 4.2% of men and 12.4% of women visitors have queries on
reproductive health. The city census 2011 population estimate was that for individuals 18 or over,

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 48.2% were men and 51.8% were women. The above-mentioned study addresses this age group.
What is the probability that a randomly chosen visitor to a health and wellness center has queries
on reproductive health. What is the probability that this visitor is also a male? Assume that these
centers are equally visited by males and females.

3. A co-pay is a fixed amount that the insured has to pay for a covered medical service and the
insurer takes care of the rest of the amount. The co-pay amount depends on the nature of the
treatment and medications. If patient A’s policy has a co-pay clause of 10% and A's claim is Rs
500,000, then A will have to pay Rs 50,000.

A study was recently performed by a hospital to determine how much its patients were asked to
contribute as co-payment based on the size of their total medical-bills. The insurance claims were
settled at amounts equal to or less than the total bill amount. A random sample of bills and
resulting co-payments were collected. These data (In thousands of Rupees) are shown as follows:

Total Bill amount Co-payment amount

126 19
58 11
86 20
20 3
59 4
120 30
14 2
17 4
26 2
74 16

Based upon these data, what is the approximate predicted value for co-payment amount, if the
total bill is Rs. 100,000?

4.(a) An airline requires its telephone reservations agents to conform to a script when talking with
customers who are redeeming frequent flyer miles. The time required to work through the script
is known to be normally distributed with a standard deviation of 30 seconds. In a sample of 36
calls, a sample average of 218 seconds is observed.

(i) What is the 95% confidence interval for the population mean?
(ii) What is the 99% confidence interval for the population mean?
(iii) How big a sample size would be required for a 95% confidence interval if we wanted
the interval to be not more than 20 seconds?

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4.(b) An analyst working with a retail chain is studying daily sales for establishments located across
East Delhi. A random sample of 36 stores exhibited a sample mean (in millions of rupees) of 86.5
and a sample standard deviation (in millions of rupees) of 12.5. Suppose the analyst's status quo
understanding is that daily sales for this class of establishment averages (in millions of rupees)
no more than 50.00.

(i) What would the null hypothesis and alternate hypothesis be in this situation?
(ii) What is the critical value for the test statistic (assume alpha = 0.05)? From the past
experience the analyst knows that the sample standard deviation she has calculated is
very close to the population standard deviation.
(iii) Given your answers to (i) and (ii), what do the results of this analysis suggest about
the analyst's status quo understanding?

SECTION B

5. A manufacturing firm produces two products. Each product must undergo an assembly process
and a finishing process. It is then transferred to the warehouse, which has space for only a limited
number of items. The firm has 80 hours available for assembly and 112 hours for finishing, and
it can store a maximum of 10 units in the warehouse. Each unit of product 1 has a profit of Rs.300
and requires 4 hours to assemble and 14 hours to finish. Each unit of product 2 has a profit of
Rs.700 and requires 10 hours to assemble and 8 hours to finish. The firm wants to determine the
quantity of each product to produce in order to maximize profit.

(i) Formulate a linear programming model for this problem .

(ii) Solve this model by using graphical method

6. (a) A plant has four operators to be assigned to four machines. The time (minutes) required by each
worker to produce a product on each machine is shown in the following table:

Operator Machine (min.)

A B C D
1 10 12 9 11
2 5 10 7 8
3 12 14 13 11
4 8 15 11 9

Solve this assignment problem using Hungarian method.

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(b) Consider the following transportation problem

From To (Cost in Rupees)

X Y Z Supply
A 6 9 100 130
B 12 3 5 70
C 4 8 11 100
Demand 80 110 60

Provide basic initial feasible solution using the Least Cost Method or the Vogel’s Approximation
Method.

7.(a) Irwin Textile Mills produce two types of cotton cloth – denim and corduroy. Corduroy is a heavier
grade of cotton cloth and as such requires 7.5 pounds of raw cotton per yard, whereas denim
requires 5 pounds of raw cotton per yard. A yard of corduroy requires 3.2 hours of processing
time; a yard of denim requires 3.0 hours. Although the demand for denim is practically unlimited,
the maximum demand for corduroy is 510 yards per month. The manufacturer has 6500 pounds
of cotton and 3000 hours of processing time available each month. The manufacturer makes a
profit of Rs.2.25 per yard of denim and Rs.3.10 per yard of corduroy. The manufacturer wants to
know how many yards of each type of cloth to produce to maximize profit.
Using the answer report and sensitivity report obtained after solving using Solver, answer the
following questions:

(i) Identify the sensitivity ranges for the objective function coefficients and for the
constraint quantity values. Then explain the sensitivity range for the demand for
corduroy.
(ii) Explain the meaning of shadow prices for the resources.

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Microsoft Excel 16.0 Answer Report
Worksheet: [Book2]Sheet11
Report Created: 30-12-2020 23:23:26
Result: Solver found a solution. All Constraints and optimality conditions are satisfied.
Solver Engine
Engine: Simplex LP
Solution Time: 0.157 Seconds.
Iterations: 2 Subproblems: 0
Solver Options
Max Time Unlimited, Iterations Unlimited, Precision 0.000001, Use Automatic Scaling
Max Subproblems Unlimited, Max Integer Sols Unlimited, Integer Tolerance 1%, Assume NonNegative

Objective Cell (Max)

Cell Name Original Value Final Value
$F$7 Objective Function Decision Variables 0 2607

Variable Cells
Cell Name Original Value Final Value Integer
$F$2 Carduroy Decision Variables 0 510 Contin
$F$3 Denim Decision Variables 0 456 Contin

Constraints
Cell Name Cell Value Formula Status Slack
$B$10 Constraints Raw Cotton 6105 $B$10<=$E$10 Not Binding 395
$C$10 Constraints Processing Time 3000 $C$10<=$E$11 Binding 0
$D$10 Constraints Carduroy 510 $D$10<=$E$12 Binding 0

Microsoft Excel 16.0 Sensitivity Report

Worksheet: [Book2]Sheet11
Report Created: 30-12-2020 23:23:29

Variable Cells
Final Reduced Objective Allowable Allowable
Cell Name Value Cost Coefficient Increase Decrease
$F$2 Carduroy Decision Variables 510 0 3.1 1E+30 0.7
$F$3 Denim Decision Variables 456 0 2.25 0.65625 2.25

Constraints
Final Shadow Constraint Allowable Allowable
Cell Name Value Price R.H. Side Increase Decrease
$B$10 Constraints Raw Cotton 6105 0 6500 1E+30 395
$C$10 Constraints Processing Time 3000 0.75 3000 237 1368
$D$10 Constraints Carduroy 510 0.7 510 182.3076923 510

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(b) For the following LPP,

Minimize 𝑍 = 5𝑥1 + 2𝑥2 + 𝑥3

subject to,
2𝑥1 + 3𝑥2 + 𝑥3 ≥ 20
6𝑥1 + 8𝑥2 + 5𝑥3 ≥ 30
7𝑥1 + 𝑥2 + 3𝑥3 ≥ 40
𝑥1 + 2𝑥2 + 4𝑥3 ≥ 50
𝑥1 , 𝑥2 , 𝑥3 ≥ 0

derive the associated dual problem if the sense of optimization in the primal problem is changed
to maximization.

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