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Bbm 355: Operations Research Question Paper
Bbm 355: Operations Research
Course:Bachelor Of Business Management
Institution: Moi University question papers
Exam Year:2012
MOI UNIVERSITY
SCHOOL OF BUSINESS & ECONOMICS
BBM 355: OPERATIONS RESEARCH
ASSIGNMENT 1: Answer ALL questions – DUE DATE 2ND AUGUST 2012
QUESTION 1
(a) Briefly trace the history of operation research and highlight the major developments especially after World War II. [5 marks]
(b) “Operations researchers normally start with a simple model and subsequently develop it into elaborate one to reflect the reality of the problem”
(i) Do you agree with this statement? Explain [6 marks]
(ii) How is a model simplified? Explain [4 marks]
(c) Managers, as decision makers can purchase computer software to solve specific Operations Research (OR) formulations and as such it is not important for them to learn the OR techniques. Comment on this statement [5 marks]
QUESTION 2
(a) Briefly describe the steps involved in simplex algorithm. [3 marks]
(b) Explain the assumption made in solving LP problems. [4 marks]
(c) A firm manufactures 3 products A, B and C. The profits are Ksh 3, Ksh 2 and Ksh 4 respectively. The firm has two machines and given below is the required processing time in minutes for each machine on each product.
A B C
Machine X 4 3 5
Machine Y 3 2 4
Machine X and Y have 2000 and 2500 minutes respectively. The firm must manufacture 100 A’s, 200 B’s and 50 C’s but no more that 150 A’s.
Required:
Formulate this as an LP problem and determine the quantities that will optimize returns. [8marks]
(c) A company can produce three products A, B and C. The products use a machine which has 660 hours capacity in the next period and 1230 labour hours. Each unit of the products A,B and C uses 3, 12 and 6 hours respectively of the machines capacity and 6, 6 and 3 hours respectively for the labour hours. There are only 990 units available in the period of a special component which is used in the production of the three products. Product A uses 6 units, while product B and C uses 9 units each. For each period, the company must produce at least 10 units of product C.
Required:
In order to maximize profits, how many products of each kind should be produced if the contribution margin are Ksh 5, Ksh 3 and Ksh 4 respectively for products A, B and C?
[10 marks]
MOI UNIVERSITY
SCHOOL OF BUSINESS & ECONOMICS
BBM 355: OPERATIONS RESEARCH
ASSIGNMENT 2: Answer ALL questions – DUE DATE 27TH SEPTEMBER 2012
QUESTION 1
a) A wholesale company has three warehouses from which suppliers are drawn for four retail customers. The company deals in a single product, the suppliers of which at each warehouse are:-
Warehouse Supply (tons)
1 20
2 28
3 17
Customer Demand tons
A 15
B 19
C 13
D 18
The following table gives the transportation costs per ton shipment from each warehouse to each customer (in KShs)
Warehouse Customer
A B C D
1 30 60 80 50
2 60 10 20 50
3 70 80 30 90
Obtain an initial feasible solution using:
(i) North west corner rule
(ii) Least cost cell method
(iii) Vogels approximation method and comment on the solutions [10 marks]
(b) i) Explain the difference between assignment and transportation problem. [2 marks]
(ii) State the assumptions made in solving transportation problems. [4 marks]
(iii) Hallo Baby Ltd has a network of branches all over Kenya. The branches are used to service, repair and install equipments for their clients. Currently the Eldoret branch has four clients who require installation of equipment. Each client requires service of one engineer.
There are four engineers who are not engaged at the moment and can be assigned any of the tasks. However, these engineers have travel from different locations and the Eldoret branch has to meet their travel and substance allowances. The allowances vary from one engineer to another and according to the client the engineer has been assigned to work for.
The table below shows the costs (in thousand shilling) associated with each engineer.
Clients
Engineer E F G H
A 17 11 8 26
B 4 26 13 28
C 18 15 38 19
D 24 10 19 26
Required;
i) The assignments to be made in order to minimize the total cost of the engineer. [7 marks]
ii) The minimum cost of using the engineers. [2 marks]
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