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Set 401: Project Management Question Paper
Set 401: Project Management
Course:Bachelor Of Science In Mechanical And Manufacturing Engineering
Institution: Kenyatta University question papers
Exam Year:2008
KENYATTA UNIVERSITY
UNIVERSITY EXAMINATIONS 2007/2008
SECOND SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR OF SCIENCE (MANUFACTURING ENGINEERING, WATER ENGINEERING AND ENERGY ENGINEERING)
SET 401: PROJECT MANAGEMENT
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DATE: Tuesday 29th April, 2008 TIME: 2.00 – 4.00 p.m.
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INSTRUCTIONS
Answer any THREE questions.
Table of normal areas attached.
Question one (20 marks)
(a) Distinguish between a project and project management. (3 marks)
(b) Explain why it is important to understand the environment in which a project takes place. (4 marks)
(c) Construct an AON network based on the following information.
Activity Immediate Predecessors
A -
B -
C -
D A, B
E C (3 marks)
(d) To complete the wing assembly for an experimental aircraft, James odour has laid out the seven major activities involved. These activities have been labelled A through G in the following table which also shows the estimated completion times (in weeks) and immediate predecessors.
2
Activity a m b Immediate (Predecessor(s)
A 1 2 3 -
B 2 3 4 -
C 4 5 6 A
D 8 9 10 B
E 2 5 8 C,D
F 4 5 6 D
G 1 2 3 E
(i) Draw an AON network for this project. (3 marks)
(ii) Determine the expected time and the variance for each activity. (4 marks)
(iii) Find the probability that Mr. Owuor’s project will be finished on or before the 16 week deadline. (3 marks)
Question two (20 marks)
(a) Explain convincingly whether a manager would consider crashing a non-critical activity in a project network. (3 marks)
(b) Given the following network, determine:
(i) the earliest and latest activity times. (10 marks)
(ii) Critical path (2 marks)
(c) Draw a Gantt for this project. (5 marks)
3
Question 3 (20 marks)
(a) Explain how a CPM differs from the DERT and indicate the advantages of the latter. (4 marks)
(b) Determine the least cost of reducing the project completion date by 3 months based on the following information.
Activity
Normal time (months)
Crash time (months)
Normal Cost in Kshs.
Crash cost
(Kshs.)
A
6
4
2,000
2,400
B
7
5
3,000
3,500
C
7
6
1,000
1,300
D
6
4
2,000
2,000
E
9
8
8,800
9,000
(16 marks)
Question 4 (20 marks)
(a) Describe the steps involved in formulating a linear programming model
(5 marks)
(b) Panpaper mills produces recycled paperboard for box manufacturers by combing four grades of recycled papers stock. Each grade of stock has a different strength, colour, and texture: The strength and texture of the paperboard are approximately a weighted average of those characteristics of
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the paper inputs. The table below gives the characteristics of the papers stocks and their cost per ton. The company has received an order for 500 tons of paperboard with a strength rating of at least 6. It would want to determine the least costly mix required to produce this paperboard.
Paper Grade Strength Colour Texture Cost/ton (Kshs)
1 8 9 8 150
2 6 7 5 110
3 5 5 6 90
4 3 4 5 50
Required:
(i) Formulate the problems as a linear program. (3 marks)
(ii) Solve this problem using the simplex method and explain the optimal
solution. (18 marks)
Question Five (20 marks)
The Kenya Power and Lighting Company (KPLC) is considering signing a one-year contract with one of the computer-based solution provider firms. Although one is more expensive, it offers a more expensive program and thus will provide a higher after-tax cash flows. Assume these two options are mutually exclusive and the required rate of return is 12%. Given the following after-tax net cash flows:
Year Option A Option B
(Kshs) (Kshs.)
0 -50,000 -100,000
1 70,000 130,000
(i) Calculate the net present value
(ii) Calculate the profitability index
(iii) Calculate the internal rate of return.
(iv) If there is no capital-rationing constraint which project should be selected.
(12 marks)
(b) Outline the key considerations for firms to use when considering project
appraisal (4 marks)
(c) Differentiate between AOA and AON network. (4 marks)
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