/ Academic Year 2017 Semester I

Transcription

1 Programme BSc (Hons) Management F/G/M/L BSc (Hons) Human Resource Management COHORT BMANF/G/M/L/12A/13A/13B /14A/14B/13B/15A15B/16A/ FT /PT BHRM/12B/13B/14A/14B/FT /PT Examinations for Academic Year Semester II / Academic Year 2017 Semester I MODULE: QUANTITATIVE METHODS FOR MANAGEMENT MODULE CODE: QUAN2203 DURATION: 2 HOURS 10 MINUTES Instructions to Candidates: 1. This paper consists of Sections A and B. 2. Section A is Compulsory. 3. Answer any two questions from Section B. 4. Always start a new question on a fresh page. 5. Total Marks: 100. This Question Paper contains 4 questions and 6 pages. This Question Paper is printed on BOTH SIDES. QUANTITATIVE METHODS FOR MANAGEMENT- QUAN2203 Page 1 of 6

2 SECTION A: COMPULSORY QUESTION 1: (40 MARKS) (a). List the steps involved in a decision making process. (6 marks) (b). Explain the meaning of the terms optimistic, pessimistic and regret as applied to payoff tables. (3 marks) (c). The management of the canteen in UTM believes there is going to be an increased demand for one of its lunch box specialities X. The management considers the following courses of action over a one month planning period. 1. Serve lunch box X with French fries; 2. Serve lunch box X with an extra farata ; 3. Serve lunch box X as it is. Management feels that the rise in demand in this one month period may be high, medium or low and has constructed the following payoffs table (in Rs 000). Course of Level of sales action High Medium Low French fries Extra farata As it is i. Which course of action should management choose under the following decision criteria: a. Maximax Criterion; (1 mark) b. Maximin Criterion; (1 mark) c. Equally likely; (2 marks) d. Criterion of realism with coefficient of 0.6; (2 marks) e. Minimax Regret Criterion. (3 marks) QUANTITATIVE METHODS FOR MANAGEMENT- QUAN2203 Page 2 of 6

3 ii. iii. iv. Compare briefly the relative merits of the different criteria used in part (i). After an analysis of the canteen s experience over the last few months and of his own experience, the manager evaluates the probabilities of the different levels of sales, i.e. high, low and medium as being 0.6, 0.1 and 0.3 respectively. a. Draw a decision tree for the canteen s management, including all the relevant information. b. Use the decision tree to advise management on the best course of action. c. Calculate the expected opportunity loss for each decision and determine the optimal decision. Moreover, the canteen management feels that the probabilities for the different sales levels should be evaluated more rigorously, by having recourse to a survey. But the manager would like to make sure that the research is worthwhile. What is the maximum amount the canteen management is ready to pay for the survey? SECTION B: ANSWER ANY TWO QUESTIONS QUESTION 2: (30 MARKS) (a). What are the requirements for effective inventory management? (6 marks) (b). List the major assumptions of the EOQ model. (6 marks) (c). Pearl Electronics Manufacturing Ltd. supplies electronic components to 75 electronic shops in Mauritius. The annual demand that the company sells is 15,000 units. The daily demand for the electronic components is estimated to be normally distributed with mean 20 and standard deviation 5. Once an order is placed, it takes 3 working days before delivery is made to its clients. The ordering cost is Rs 275 per order and the average carrying cost per unit per year is Rs 55. i. Under the above assumptions, what is the economic order quantity (EOQ)? QUANTITATIVE METHODS FOR MANAGEMENT- QUAN2203 Page 3 of 6

4 ii. What is the expected number of orders to be placed each year? (2 marks) iii. What is the annual cost associated with your recommended EOQ? (3 marks) iv. The company is concerned about stock outs of such items and, thus, desires a 95% service level. (a). What safety stock should Pearl Electronics Manufacturing Ltd maintain Using the above information? (6 marks) (b). Compute the reorder level. (2 marks) QUESTION 3: (30 MARKS) (a) An electric company produces two products and. Products are produced and sold on a weekly basis. The weekly production cannot exceed 25 for product and 35 for product because of limited available facilities. The company has a total of 60 workers. Product requires 2 man-weeks of labour, while requires 1 man-week of labour. Profit margin for and are $60 and $40 per unit, respectively. (i) Formulate this problem as a Linear Programming problem to maximize profit. (ii) Hence use the graphical method to solve it. (b) With reference to the graphical method, Explain the following terms: (i) Multiple solution (ii) Unbounded solution (3 + 3 marks) (c) Use the simplex method to solve the following Linear Programming problem: Subject to (14 marks) QUANTITATIVE METHODS FOR MANAGEMENT- QUAN2203 Page 4 of 6

5 QUESTION 4: (30 MARKS) (a) A company has four terminals U, V, W and X. At the start of a particular day, 10, 4, 6 and 5 trailers, respectively are available at these terminals. During the previous night, 13, 10, 6 and 6 trailers respectively were loaded at plants A, B, C and D. The company has come up with the costs (in $) between the terminals and plants, as follows: PLANTS A B C D TERMINAL U V W X (i) Find the initial basic feasible solution using Vogel s Approximation method. (6 marks) (ii) Hence, find the optimal solution in order to minimise the transportation cost. (10 marks) (b) An organization producing four different products, A, B, C and D has four operators, P, Q, R and S, who are capable of producing any of the four products, works effectively 7 hours a day. The time (in minutes) required by each operator to produce each of the product is given in the following table, along with the profit per unit in $: (Cont ) QUANTITATIVE METHODS FOR MANAGEMENT- QUAN2203 Page 5 of 6

6 PRODUCT A B C D P OPERATOR Q R S Profit/ unit ($) (i) Compute the production and profit matrix using the given information. (ii) Hence, perform the assignment of operators to products which will maximize the profit. (10 marks) ***END OF QUESTION PAPER*** QUANTITATIVE METHODS FOR MANAGEMENT- QUAN2203 Page 6 of 6