Assignment-3 Quantitative Methods (Stat-201) Week 9 to week 11 Student’s Name: _
ID: 3225531 • Letter: A
Question
Assignment-3
Quantitative Methods
(Stat-201)
Week 9 to week 11
Student’s Name: _________________________________________________
Student’s ID: ___________________________________________________
CRN No.: ______________________________________________________
Note: All the questions are to be attempted.
Section-I
State whether the following statements are True or False. (1×6=6)
Transportation problem is an example of linear programming problem.
The linear programming model of the product mix problem only includes constraints of the less than or equal form.
In a transportation problem if the availability is equal to demand at destination then the problem is a balanced transportation problem.
Economic Order Quantity (EOQ) is the number of products in each order, which minimize the total cost of holding inventory and the cost of stock outs.
The two fundamental decisions that you have to make when controlling inventory are: (1) how much to order, and (2) how much money to spend.
If in an inventory management problem lead-time is 5 days and daily demand is 10 per day then re-order point is 50.
Section-II
Circle/tick the right answer from the answers given below. (1×6=6)
What is the total transportation cost of the problem given in Table below?
A) 550
B) 300
C) 500
D) 450
Consider the material structure tree for item A below. If 10 units of A are needed, how many units of E are needed?
A) 200
B) 300
C) 100
D) 240
Extra inventory that is used to avoid stock outs is known as
A) Planned shortages.
B) Quantity discounts.
C) Safety stock.
D) Service level.
The EOQ model without the instantaneous receipt assumption is commonly called the
A) Quantity discount model.
B) Safety stock model.
C) Planned shortage model.
D) Production run model.
In an inventory control problem if orders quantity is 200, what would be the average inventory (in units)?
A) 100
B) 200
C) 60
D) 120
When formulating a transportation problem as LP model, if there are 3 sources and 4 destinations, which of the following statements is true?
A) There are typically 4 decision variables and 3 constraints.
B) There are typically 12 decision variables and 7 constraints.
C) There are typically 7 decision variables and 7 constraints.
D) There are typically 12 decision variables and 12 constraints.
Section-III
Answer the following Essay Type Questions. (3×6=18)
The table below describes a transportation problem:
(a) Check whether the problem is balance or not.
(b) Use the northwest corner method to get an initial solution.
(c) What is the cost of the initial solution?
Formulate the following transportation problem as a linear programming problem:
A company sells motherboards to some mobile manufacturers. Company wants to reduce its inventory cost. The annual demand of motherboards is 1,000 units, the ordering cost is $20 per order, and the average carrying cost per unit per year is $1.
How many motherboards should be ordered at a time to minimize total inventory cost?
Find number of orders per year.
Find annual ordering cost.
Find annual holding cost.
Apple Inc. produces smartphones. Annual of smartphones is 4000 units and is constant throughout the year. Apple Inc. produces the smartphones in batches. On average, Apple Inc. can manufacture 100 smartphones per day. Demand for these smartphones during the production process is 20 per day. The setup cost for the equipment necessary to produce the smartphones is $20. Carrying costs are $1 per smartphones per year.
How many smartphones should Apple Inc. manufacture in each batch?
How many orders per year are needed with the optimal policy?
What is the average inventory if costs are minimized?
If lead time is 2 days, what should be the re-order point?
What will the minimum total annual inventory cost?
The F. W. Harris Company sells an industrial cleaner to a large number of manufacturing plants in the Houston area. An analysis of the demand and costs has resulted in a policy of ordering 300 units of this product every time an order is placed. The demand is constant, at 25 units per day. In an agreement with the supplier, F. W. Harris is willing to accept a lead-time of 20 days since the supplier has provided an excellent price. What is the reorder point? How many units are actually in inventory when an order should be placed?
Consider the material structure tree for item A below. Assume 15 units of A are needed.
(a) How many units of B are needed?
(b) How many units of C are needed?
(c) How many units of D are needed?
(d) How many units of E are needed?
THE=END
Supply 20 From A 40 30 30 L5 7 20 10 30 70 10 Demand 20Explanation / Answer
Please dont post these many multiple questions at a time. You have less chance of getting the full answers According to rules, I can provide answers for first section
SECTION-I 1.
a) Transportation problem is an example of linear programming problem.
True : Transportation problem is a type of linear programming problem.
b) The linear programming model of the product mix problem only includes constraints of the less than or equal form.
False: The three types of constraints are less than or equal to (), greater than or equal to (), and simply equal to (=).
c) In a transportation problem if the availability is equal to demand at destination then the problem is a balanced transportation problem.
True: Balanced Transportation Problem is a transportation problem where the total availability at the origins is equal to the total requirements at the destinations. For example, in case the total production of 5 factories is 1200 units and total requirements of 5 warehouses is also 1200 units, the transportation problem is said to be a balanced one.
d) Economic Order Quantity (EOQ) is the number of products in each order, which minimize the total cost of holding inventory and the cost of stock outs.
True: The economic order quantity (EOQ) is the amount of inventory to be ordered at one time for purposes of minimizing annual inventory cost.
e) The two fundamental decisions that you have to make when controlling inventory are: (1) how much to order, and (2) how much money to spend.
False: We can not decide how much money to spend while controlling inventory.
f) If in an inventory management problem lead-time is 5 days and daily demand is 10 per day then re-order point is 50.
True: Re - order point is lead time × Daily demand = 5 × 10 = 50
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