Department of Industrial Engineering

INDR 100 – Introduction to Industrial Engineering

Questions for Homework #5

Submission Deadline: 29.12.2021 (Wednesday until 23:59)

How to upload your homework:
● Upload your PDF document to the BLACKBOARD, under the Course Content
– Homeworks – HW5 – HW5_Submission folder.
● Do not forget to put all your work in one PDF document
● The name of your PDF file should be in the following format
INDR100_YOURNAMESURNAME_HW#5

1) Consider the Chapters 31-40 of the book “The Goal” and answer the following questions.
a. What are the most fundamental abilities one would expect from a manager?
b. What are the Five Steps of the Theory of Constraints?
c. When everything was going well, suddenly Stacey mentioned the existence of some problems.
"The situation is out of control" Stacey continues. Briefly explain the reason for this problem and
indicate the solution.

2) Consider Korku fruit juice manufacturing company that produces only four types of fruit juices – A, B,
C and Mixed. All the fruit juices require Water, Sugar and Fruit only. To manufacture each unit of A,
B, C and Mixed, the following quantities are required:
Water Sugar Fruit A Fruit B Fruit C Sale Price
Juice A 10 5 3 - - 12 TL
Juice B 12 6 - 2 - 10 TL
Juice C 13 3 - - 4 9 TL
Juice Mixed 8 4 1 2 1 12 TL
The company kitchen has a total of 150 units of Water, 120 units of Sugar and 100 units of each
Fruits.

Formulate a linear programming model to maximize its total profit. Define the decision variables,
state the objective function, and specify all the constraints.
3) A company producing chocolate has three chocolate factories and four distribution warehouses
throughout Turkey. Management initiates a study to reduce its total transportation cost and asks you to
analyze the system via mathematical models. To this end, formulate a linear programming model to
minimize its total transportation cost. In doing so, define the decision variables, state the objective
function, and specify all the constraints by using the information given in the table below:

Transportation Costs

Warehouse
1 2 3 4
Output
Factory A 125 231 154 176 75

Factory B 132 173 107 129 125

Factory C 180 147 138 184 110

Demand 80 55 90 85

4) A company wishes to plan its production of two items with seasonal demands over a 12-month period.
The monthly demand of item1 is 90 units during the months of October, November and December; 20
units during the months of January, February, March and April; and 30 units during the remaining
months. The demand of item2 is 60 units for months with more than 30 days and 25 units during the
remaining months. Suppose that the unit product cost of item1 and item2 is 6000 TL and 9000 TL,
respectively, if they are manufactured before June 30. After July 1, the unit costs are reduced to 3500
TL and 7200 TL because of the installation of an improved manufacturing system. Item1 requires 1 unit
of a key component and item2 requires 2 units. The availability of this key component is 120 units per
month during January-September and 150 units per month during October-December. Furthermore,
each unit of item1 occupies 2 m3 and each item2 occupies 4 m3 of inventory. Suppose that the maximum
inventory space allocated to these items is 200 m3 and that the holding cost during any month is 100
TL/m3.
Formulate a linear programming model which will represent this system. Define the decision
variables, state the objective function, and specify all the constraints.
 Bonus Questions
Solving these questions (Q5 and Q6) are not mandatory. Only those who want to earn bonus points
should solve these questions.

5) (Bonus) Consider the book “The Goal” and answer the following questions.
a. You are a manager of a plant that is constrained by the market. That is, there are no internal
machine constraints limiting your production. You have a choice to produce an order in either
one lot of 1000 units or ten lots of 100 units each.
i) Explain how and why the choice of lot size affects the level of inventory in the form of WIP
(work in process). Does this effect favour large lots or small lots?
ii) The operations of the manufacturing process require a setup time for each new lot. How does
this consideration affect the choice of lot size? Does it favour small lots or large lots?
iii) Explain how and why the lot size affects the cash flow for the plant. Does this effect favour
large lots or small lots?
b. You are a consultant trying to convince potential customers of the value of the Theory of
Constraints for managing their company. Each case below is the comment of a production
manager to your sales pitch. Make up short statements to counter the arguments.
i) "My production facility has no constraints. The current production meets the demand, and all
the manufacturing departments have slack time. The theory of constraints is irrelevant for my
situation."
ii) "Our problem is not bottlenecks. We don't have any. Our problem is the time it takes to get
products through the system. Although it only takes 2 hours to manufacture the product, a given
order takes three weeks to make it through the plant. By the time the product is ready for
delivery, the customer may not want it any more or may want to change the order."
6) (Bonus) Mehmet wants to buy a workstation computer to use in his research. The necessary parts of
this computer consist of CPU, mainboard, RAM, video card, sound card, keyboard, mouse. Mehmet
wants to buy the mouse and keyboard from the same brand. He wants to buy sound and video card from
different brands. If the CPU is i5, it should receive 32 GB ram, otherwise it will not be able to provide
the necessary performance. In the table below, the brand and price of each part is given. Mehmet plans
to buy a minimum cost workstation computer using this data.
Formulate an integer programming model which will represent this system. Define the decision
variables, state the objective function, and specify all the constraints.

Option A Option B Option C Option D

Intel Core i7 Intel Core i5 AMD Core i7 AMD Core i5
CPU
8.591 TL 5.942 TL 10.345 TL 7.456 TL
GIGABYTE ASUS MSI NZXT
Mainboard
1.818 TL 2.758 TL 2.648 TL 1.245 TL
CORSAIR CORSAIR
GSKILL 32GB GSKILL 16 GB
RAM 32GB 16GB
9.843 TL 4.443 TL
8.925 TL 2.340 TL
HyperX ASUS S-LINK Samsung
Video Card
1.236 TL 1.491 TL 1.012 TL 2.818 TL
HyperX ASUS S-LINK Samsung
Sound Card
349 TL 437 TL 245 TL 555 TL
Logitech MICROSOFT ASUS FRISBY
Keyboard
345 TL 453 TL 256 TL 125 TL
Logitech MICROSOFT ASUS FRISBY
Mouse
245 TL 333 TL 274 TL 123 TL