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MBA SEMESTER II MB0048 Operation Research- 4 Credits (Book ID: B1137) Assignment Set- 1 (60 Marks)

Note: Each question carries 10 Marks. Answer all the questions 1. Outline the broad features of the Judgement phase and Research phase of the scientific method in OR. Discuss in detail any of these phases. Answer: The scientific method in OR study generally involves the following three phases: i) Judgment Phase: This phase consists of a) Determination of the operation. b) Establishment of the objectives and values related to the operation. c) Determination of the suitable measures of effectiveness and d) Formulation of the problems relative to the objectives. ii) Research Phase: This phase utilizes a) Operations and data collection for a better understanding of the problems. b) Formulation of hypothesis and model. c) Observation and experimentation to test the hypothesis on the basis of additional data. d) Analysis of the available information and verification of the hypothesis using pre established measure of effectiveness. e) Prediction of various results and consideration of alternative methods. iii) Action Phase: It consists of making recommendations for the decision process by

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Q2. Operation Research is an aid for the executive in making his decisions by providing him the needed quantitative information, based on scientific method analysis. Discuss. Answer: The basic dominant characteristic feature of operations research is that it employs mathematical representations or model to analyze problems. This distinctive approach represents an adaptation of the scientific methodology used by the physical sciences. The scientific method translates a real given problem into a mathematical representation which is solved and retransformed into the original context. The OR approach to problem solving consists of the following steps: 1. Definition of the problem. 2. Construction of the model. 3. Solution of the model. 4. Validation of the model. 5. Implementation of the final result. 1 Definition of the problem The first and the most important requirement is that the root problem should be identified and understood. The problem should be identified properly, this indicates three major aspects: (1) a description of the goal or the objective of the study, (2) an identification of the decision alternative to the system, and (3) a recognition of the limitations, restrictions and requirements of the system. 2 Construction of the model Depending on the definition of the problem, the operations research team should decide

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3. A furniture manufacturer makes two products: chairs and tables. Processing of these products is done on two machines A and B. A chair requires 2 hours on machine A and 6 hours on machine B. A table requires 5 hours on machine A and no time on machine B. There are 16 hours per day available on machine A and 30 hours on machine B. Profit gained by the manufacturer from a chair and a table is Rs 2 and Rs 10, respectively. What should be the daily production of each of the two products? Answer: Product Chair Table Available Machine A 2 5 16 Machine B 6 0 30 Profit unit 2 10 per

Time The Linear Programming model for the above problem can be written as: Maximize Z = 2x1 + 10x2 Subject to 2x1 + 5x2 <= 16 6x1+ 0x2 <= 30 or x1, x1 >= 0 6x1 <= 30

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Q4. Given a general linear programming problem, explain how you would test whether a basic feasible solution is an optimal solution or not. How would you proceed to change the basic feasible solution in case it is not optimal? Answer: To test for optimality of the current basic feasible solution of the LPP, we use the following algorithm called simplex algorithm. Let us also assume that there are no artificial variable existing in the program. 1 Steps 1) Locate the most negative number in the last (bottom) row of the simplex table, excluding that of last column and call the column in which this number appears as the work column. 2) Form ratios by dividing each positive number in the work column, excluding that of the last row into the element in the same row and last column. Designate that element in the work column that yields the smallest ratio as the pivot element. If more than one element yields the same smallest ratio choose arbitrarily one of them. If no element in the work column is non negative the program has no solution. 3) Use elementary row operations to convert the pivot element to unity (1) and then

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Q5. State and discuss the methods for solving an assignment problem. How is Hungarian method better than other methods for solving an assignment problem?

Answer: The assignment problem is a special case of the transportation problem, where the objective is to minimize the cost or time of completing a number of jobs by a number of persons and Maximize efficiently Revenue, sales etc In other words, when the problem involves the allocation of n different facilities to n different tasks, it is often termed as an assignment problem. This model is mostly used for planning. The assignment model is also useful in solving problems such as, assignment of machines to jobs, assignment of salesman to sales territories, traveling salesman problem etc. It may be noted that with n facilities and n jobs, there are n! possible assignments. One way of finding an optimal assignment is to write all the n! possible arrangement ,evaluate their total cost and select the assignment with minimum cost. But because of many computational procedures this method is not possible. There are n jobs for a factory and factory has n machines to process the jobs. A job i(=1,,n) , when processed by machine j(=1,,n) is assumed to incur a cost Cij.The assignment is to be made in such a way that each job can associate with one and only one machine Determine an assignment of jobs to machines so as to minimize the overall cost. Hungarian Method: Algorithm Step 1: Prepare Row ruled Matrix by selecting the minimum values for each row and

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6. Compare and contrast CPM and PERT. Under what conditions would you recommend scheduling by PERT? Justify your answer with reasons. Answer: Basic difference between PERT and CPM Though there are no essential differences between PERT and CPM as both of them share in common the determination of a critical path and are based on the network representation of activities and their scheduling that determines the most critical activities to be controlled so as to meet the completion date of the project. 1 PERT 1. Since PERT was developed in connection with an R and D work, therefore it had to cope with the uncertainties which are associated with R and D activities. In PERT, total project duration is regarded as a random variable and therefore associated probabilities are calculated so as to characterise it.

2. It is an eventoriented network because in the analysis of network emphasis is given an important stages of completion of task rather than the activities required to be

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MBA SEMESTER II MB0048 Operation Research- 4 Credits (Book ID:B1137) Assignment Set- 2 (60 Marks)
Note: Each question carries 10 Marks. Answer all the questions Q1. State the different types of models used in OR. Explain briefly the general methods for solving these OR models? Answer: Types of operation Research Models A model is a representation of the reality. It is an idealized representation or abstraction of a real life system. The objective of the model is to identify significant factors and their interrelationship. A model is helpful in decision making as it provides a simplified description of complexities and uncertainties of a problem in logical structure. Major advantage of models is it does not interfere with real system. A broad classification of OR models a) Physical Model b) Mathematical or symbolic model c) Models by nature of Environment and d) Models by the extent of generality. a. Physical Modes include all form of diagrams, graphs and charts. They are designed to deal with specific problems. They bring out significant factors and interrelationship in pictorial firm so as to facilitate analysis. There are two types i) Iconic models and ii) Analog models. Iconic model is an image of an object or system, represented on a small scale. These models can simulate the actual performance of a product. Analog models are small physical systems that has similar characteristics and work like an objects it represents Eg: Toy b. Mathematical Model or symbolic models employ a set of mathematical symbols to

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Q2. What are the meaning and role of the lower bound and upper bound in the branch and bound method? Answer: The Branch And Bound Technique

Sometimes a few or all the variables of an IPP are constrained by their upper or lower bounds or by both. The most general technique for the solution of such constrained optimization problems is the branch and bound technique. The technique is applicable to both all IPP as well as mixed I.P.P. the technique for a maximization problem is discussed below: Let the I.P.P. be

To explain how this partitioning helps, let us assume that there were no integer restrictions (3), and suppose that this then yields an optimal solution to L.P.P. (1), (2), (4) and (5). Indicating x1 = 1.66 (for example). Then we formulate and solve two L.P.Ps each containing (1), (2) and (4). But (5) for j = 1 is modified to be 2 x1 U1 in one problem and L1 x1 1 in the other. Further each of these problems process an

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Q3. (a) Give an algorithm to solve an assignment problem. (b) Show that an assignment problem is a special case of transportation problem? Answer: (a) algorithm to solve an assignment problem:

Step 1: Prepare Row ruled Matrix by selecting the minimum values for each row and subtract it from other elements of the row Step 2: Prepare column reduced Matrix by subtracting minimum value of the column from the other values of that column Step 3: First rowwise assign a zero by if there is only one zero in the row and cross (X) other zeros in that column. Step 4: Now assign column wise if there is only one zero in that column and cross other

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4. What is a game in game theory? What are the properties of a game? Explain the best strategy on the basis of minimax criterion of optimality. Answer: Game : Competitive situations occur when two or more parties with conflicting interests operate. The situations may occur as follows. 1 Marketing different brands of a commodity. Two (or more) brands of detergents (soaps) try to capture the market by adopting various methods (courses) such as advertising through electronic media, providing cash discounts to consumers or offering larger sales commission to dealers. 2 Campaigning for elections. Two (or more) candidates who contest an elections try to capture more votes by adopting various methods (courses) such as campaigning through T.V., door to door campaigning or campaigning through public meetings. 3 Fighting military battles. Two forces fighting a war try to gain supremacy over one another by adopting various courses of action such as direct ground attack on enemy camp, ground attack supported by aerial attack or playing defensive by not attacking. We consider each of the above situations to be a competitive game where the parties (players) adopt a course of action (play the game). properties of a Competitive Game A competitive game has the following properties.

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Q5. What do you understand by (i) Queue discipline, (ii) Arrival process (iii) Service process? Answer: i. Queue discipline: Queue Discipline The pattern of selection for service from the pool of customers is of two types. The common pattern is to select in the order in which the customers arrive. First come first served is a common example. In issuing materials from a stores inventory sometimes the storekeeper follows the Last In First Out principle because of the convenience it offers for removal from stocks and handling. There can also be queues which accord priority to certain types of customers. Here again there can be two approaches. In case of non preemptive priority the customer getting service is allowed to continue with service till completion, even if a priority customer arrives midway during his service. This is a common form of priority. Preemptive priority involves stopping the service of the non priority customers as soon as the priority customer arrives. Priority given to repairs of a production holding machine over an auxiliary unit for allocation of maintenance labour force is a typical example. Preference is given to larger ships over the smaller ones irrespective of the order in which they arrive for allocation of berths. Customer Behaviour a) Balking: Arriving customers are said to balk if they do not join a queue because of

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Q6. State two major reasons for using simulation. Explain the basic steps of Monte-Carlo simulation. Briefly describe the application in finance & Accounting. Answer: Generally in developing mathematical models of various systems or situations, it is assumed that the statistical distribution of the variables conforms to a standard pattern. This, however, is not always true. In a typical pricing problem, the management cannot risk changing the price of the product without evaluating the various alternatives. Also, representation of the reality in terms of a mathematical model becomes virtually impossible because of the complexity of the interaction of several variables having a bearing on the final outcome. One approach to the problem is to assign probabilities of achieving various sales targets under different conditions of completion with changes in price, demand, etc. and choose the alternative which gives the maximum profit. Where formulating a mathematical model is difficult, simulation is of great help for decision making.

Simulation may be called experimentation in the management laboratory. In the context of business problems, simulation is often referred to as Monte Carlo Analysis. The expression may be traced to two American mathematicians, Von Neumann and Ulan, who in the late 1940s found a problem in the field of nuclear physics too complex for

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