PRACTICE PROBLEMS

For each of the situations given below, a solution/statement S has also been provided.
For each S, state True/False giving reasons.

A Suppose that you have solved an Aggregate Production Planning problem using
Transportation method, only to discover later that the inventory cost/unit has been
overestimated.

S: The original optimal plan will not change.

B XYZ has received an order for the supply of 50000 sheets of special paper. For
preparing the order, sheets are packed into stacks of 1000 each by a packer. An
inspector then inspects each stack. A helper carries the inspected stacks, 10 at a time to
dispatch for crating.
Relevant data are given below:
Activity Packing Inspection Transport
Crating
Time taken 8 min/stack 3 min/stack 5 min/trip
3 min/stack

Delays for each stack while awaiting inspection are 2 min. and transport delays for each
group of 10 inspected stacks are 4 min.

S: The minimum time to complete the order is 442 mins.

C Consider the purchasing decision of a standard item X by a company, the annual

demand D for which is deterministic and uniform. The relevant costs are the inventory
carrying costs and the ordering costs. The problem is to decide on the number of orders
to be placed and the order sizes (quantity) corresponding to each order that would
minimize the total costs. D is known to be 1000units.

S: The optimal purchasing plan is to have 4 orders of sizes 400,300,200 and 100.

D: Consider an N jobs one machine-scheduling problem with processing time

data for jobs given. The objective is to minimize the average flow time.

S: The optimum solution is to apply the Shortest Processing Time rule.

E. Consider the RPW method for line balancing. Before allocating an element to
a workstation, a check on remaining time and precedence are made.

S: The precedence check is redundant

F Two units of A, one unit of B and two units of C are assembled into a product P.
Production of A, B and C require machines 1 and 2 in that order. One unit of A requires
1 and 2 minutes of m/c1 and 2 time respectively. Similarly, a unit of B requires 4 and 2
minutes of time and a unit of C requires 3 and 1 minutes of time on these two machines.
Assembly is done manually and it takes 8 minutes per P assembled.

S: If two of m/c1and 1of m/c2 are available and operators are not a constraint, the
maxm P that can be produced by this system in the stabilised state is 10 units per hour.

G Consider the problem of finding the minimum cost production plan so as to

meet the demands of 24, 16, 25, 15, 35, 6, 25, 14 units for the upcoming 8 months,
February to September. Backordering is not allowed and the relevant costs are setup
cost of Rs. 70 and inventory carrying cost of Rs. 2 per unit on units left at the end of any
month. Capacity available for production in any month is 40 units.

S: The minimum cost production plan will be to produce 40, 0, 40, 0, 35, 6, 39, 0

H Consider the purchasing decision of a standard item X by a company, the annual

demand D for which is deterministic and uniform. The relevant costs are the inventory
carrying costs and the ordering costs. Currently the item is ordered in batches of 500
units, for which the annual ordering costs is found to be almost four times that of the
annual inventory carrying costs. The problem is to decide on the optimal batch size that
would minimize the total costs.

S: The optimal batch size is 250 units.

I. Consider the activities and times of a cigarette packaging line :

Count 20 cigarettes from a stack of cigarettes 5 seconds
Put 20 cigarettes in a box and seal 10 seconds
Put 10 boxes in a cartoon and pack 15 seconds

S : Min. 6 persons should be engaged in Activity 1 to produce 120 Cartoons per hour.

J. Consider the problem of determining the minimum cost production plan for the
next four months so as to meet the demand of 3, 4, 4 and 5 units respectively. The
relevant costs are the production cost C(X) and the inventory carrying cost.
Backordering is not allowed.

C(X) = Rs.(100+2X), if production in a period (X) is greater than 0. In case there is

no production then C(X) = 0. The inventory carrying cost is Rs.10/unit levied on the
inventory left at the end of any month. In any month not more than 8 units can be
produced.

S: Increasing the capacity from the current level of 8 units will not be useful.

K. ABC has demands for beams of four different strengths. Strength of a beam
depends on its unit weight, higher weight implying higher strength. Manufacture of
 beams of each type of strength requires an expensive set up cost. A beam of higher
strength can be used to meet the demand for beams of lower strength (note the extra
cost of material involved in such case). The relevant data is given below.

Strength 1 2 3
4
Unit weight (kg) 6 9 11
14
Set up cost (Rs.) 2400 2600 2800 3000
Demand (units) 80 90 80
100
(cost per unit weight of material = Rs.10/kg)

S: Producing 180 of strength 4 and 170 of strength 2 is optimal.

L. ABC manufactures toy wagons on a mass scale. Each wagon requires a body, four
wheels, one handle and two axles. Body is formed in the stamping department and
then it goes to the welding department where mounting brackets are welded on. The
capacities of the two departments are 250 and 200 per day respectively. Wheels are
fabricated in a separate department that can produce 1000wheels per day. Handles
and axles are processed in yet another department. The production rates are 500
handles per day and 1000 axles per day respectively, if only handles or axles are
produced. The different parts are finally assembled in an assembly department
whose capacity is 250 wagons per day.

S: The capacity of the above system is 200 wagons per day.

M. ABC is interested in determining the minimum cost schedule for picking up goods
from a warehouse where all its suppliers send the shipments. Estimated arrivals of
shipments in the next four periods are 16, 5, 12, 9 hundred cubic feet respectively.
ABC has to pay Rs.50/period/hundred cu.ft of space it utilises. ABC can hire a truck
(capacity 50 hundred cu.ft) in any period for picking up the goods. Cost of such
truck service is Rs.1000.

S: It is best to have truck services on 2nd and the 4th period.

N. The Municipal Corporation of a city has decided to construct a parking lot. The job
involves removing waste material from one place and dumping it to a dumping
ground at a distance. A shovel is to be employed for removing the material and
trucks are to be employed for transporting the material at the dump point. The
relevant operations times in minutes are given below.
Time to load a Truck 7.5
 Travel time to dump point 9
Dumping time 2
Return time 7
The problem is to decide on the number of trucks to hire. The hourly cost of the
shovel (with operator) is Rs.50, whereas the hourly cost of the truck (with driver) is
around Rs.200.

S: As only one shovel is to be deployed, 4 trucks will be ideal.

1. A tire manufacturing company has agreed to deliver the following during the next 3 months:

Month Nylon Fiberglass

June 4000 1000

July 8000 5000
August 3000 5000

Total 15000 11000

The company has two presses, a Wheeling machine and a Regal machine, and appropriate
molds that can be used to produce these tires, with the following production hours available in
the upcoming months:

Wheeling Regal
Machine Machine

June 700 1500

July 300 400
August 1000 300

The production rates for each m/c & tire combination, in terms of hours per tire, are as
follows:

Wheeling Regal
Machine Machine

Nylon 0.15 0.16

Fiberglass 0.12 0.14

The variable costs of producing tires are Rs.5.00/ operating hour, regardless of which machine
is being used or which tire is being produced. There is also an inventory-carrying charge of
Rs.0.10 per tire per month. Material costs for the nylon and fiberglass tires are Rs.3.10 and Rs.
3.90 per tire, respectively. Finishing, packaging and shipping costs are Rs.0.23 per tire. Prices
have been set at Rs.7.00 per nylon tire and Rs.9.00 per fiberglass tire.
The manager is interested in determining the production plan in order to meet the delivery
requirements at minimum cost. Give a LP formulation of the problem. Apply a heuristic to
arrive at a solution (the production plan and the contribution).