SRI CHANDRASEKHARENDRA SARASWATHI VISWA MAHA

VIDHYALAYA UNIVERSITY

I M.Sc. Practical Examination (Lab 1)

Operations Research and Managerial Decision Making using Excel

Answer any Six: (One from each topic is compulsory) Time: 3 hrs.

Max. Marks: 100.

1. BRIGHT FACE Company management is faced with the problem of choosing one of
three products: Oil face wash; Dry face wash & Silky Face wash for manufacturing. The
potential demand for each product may turn out to be good, moderate or poor. The
probabilities for each of the states of nature were estimated as follows:

States of Nature
Product Good Moderate Poor
Oil Face Wash 0.7 0.2 0.1
Dry Face Wash 0.5 .03 0.2
Silky Face Wash 0.4 0.5 0.1
The estimated profit or loss under the three states may be taken as

States of Nature
Product Good Moderate Poor
Oil Face Wash 300000 200000 100000
Dry Face Wash 600000 300000 200000
Silky Face Wash 400000 100000 -150000
Advice the management about the choice of the product

2. SMOKE Tobacco company purchases tobacco and stores in ware houses located in the
following four cities

Warehouse location City A City B City C City D

Capacity (tones) 90 50 80 60

The warehouses supply tobacco to cigarette companies in three cities that have the
following demand

Cigarette Company Bharat Janta Red Lamp

Demand (tones) 120 100 110

The adjoining railroad shipping costs per tonnes (in hundred rupees) have been
determined as follows
 Bharat Janatha Red Lamp

A 7 10 5

B 12 9 4

C 7 3 11

D 9 5 7

Because of railroad construction, shipments are temporarily prohibited from warehouse at

city A to Bharat Cigarette Company. Find the optimum distribution for the company.

3. BULLBULL Company has three factories at Amethi, Baghpat and Gwalior and four
distribution centers at Allahabad, Bombay, Calcutta and Delhi. With identical cost of
production at the three factories the only variable cost involved is the transportation cost.
The production at the three factories is 5000 tonnes, 6000 tonnes and 2500 tonnes
respectively. The demand at four distribution centers is 6000 tonnes, 4000 tonnes 2000
tonnes and 1500 tonnes respectively. The transportation costs per tonne from different
factories to different centers are given below

Distribution Centers

Allahabad Bombay Calcutta Delhi

Amethi 3 2 7 6

Factory Baghpat 7 5 2 3

Gwalior 2 5 4 5

Suggest the optimum transportation schedule and find the minimum cost of
transportation.

4. PASSTIME Snacks Company is engaged in manufacturing 5 brands of packed snacks. It is having

five manufacturing setups, each capable of manufacturing any of its brands, one at a time. The
costs to make a brand on these setups vary according to the following table.

S1 S2 S3 S4 S5

B1 4 6 7 5 11

B2 7 3 6 9 5

B3 8 5 4 6 9

B4 9 12 7 11 10

B5 7 5 9 8 11
 Assuming the five setups are S1,S2,S3,S4 & S5 and the five brands are B1,B2,B3,B4 & B5,
find the optimum assignment of products on these setups resulting in the minimum
cost.

5. DEVRAJ refrigerator needs five repair jobs which have to be assigned to five mechanics. The
estimated time (in hours) that each mechanic requires to complete the repair job is given in the
following table.

Job

J1 J2 J3 J4 J5

M1 7 5 9 8 11

M2 9 12 7 11 10

Mechanic M3 8 5 4 6 9

M4 7 3 6 9 5

M5 4 6 7 5 11

Assuming that each mechanic can be assigned to only one job, determine the minimum
time assignment.

6. A clever investor is given the following investment alternatives and percentage rates of
return

Market Conditions
Options Low Medium High
Regular Shares 7% 10% 15%
Risky Shares -10% 12% 25%
Property -12% 18% 30%
Over the past 300 days, 150 days have been medium markets conditions and 60 days have had
high market increases. On the basis of these data, state the optimum investment strategy for the
investment.

7. PROPPROD Company produces five products A, B, C, D and E. These products have to

be produced in the ratio 1:3:3:4:2. These products use three materials 1, 2 and 3. Product
A requires 9 units of material 1, 8 units of material 2 and 10 units of material 3. Product
B requires 7 units of material 1, 6 units of material 2 and 8 units of material 3. Product C
requires 5 units of material 1, 4 units of material 2 and 6 units of material 3. Product D
requires 3 units of material 1, 2 units of material 2 and 4 units of material 3. Product E
requires 1 units of material 1, 0 units of material 2 and 2 units of material 3. The available
units of materials 1, 2 and 3 are 800, 600 and 1000 respectively. The selling prices of
Products A, B, C, D and E are $28, $24, $20, $16 and $12 respectively. Formulate the
problem as a linear programming problem in Excel® and using Solver find the optimum
production of products A, B, C, D and E which will maximize the revenue
8. A farmer has 1,000 acres of land on which he can grow corn, wheat or soyabeans. Each
acre of corn costs Rs. 100 for preparation, requires 7 man-days of work and yield a profit
of Rs. 30. An acre of wheat cost Rs. 120 to prepare, requires 10 man-days of work and
yields a profit of Rs.40. An acre of soyabeans cost Rs.70 to prepare, requires 8 man-days
of work and yields a profit of Rs.20. If the farmer has Rs.1,00,000 for preparation and can
count on 8,000 man-days of work, how many acres should be allocated to each crop to
maximize profit?
9. Solve the following LP problem using Solver

Minimize Z = x1  3x 2  3 x 3 , subject to the constraints

(i) 3 x1  x 2  2 x 3  7 , (ii) 2 x1  4 x 2  12 , (iii)  4 x1  3 x 2  8 x 3  10 and

x1 , x 2 , x 3  0.

10. Solve the following LP problem using solver

Maximize Z = 90 x1  60 x 2 , subject to the constraints

(i) 5 x1  8 x 2  2000, (ii) x1  175, (iii) x 2  225, (iv) 7 x1  4 x 2  1400 and

x1 , x 2  0.