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Assignment 2
MBA Cohort Aug 2010
Instructions:
1. Answer allquestions.
2. Date of submission : 27 October 2010
3. Total number of mars is 75.
Question 1
The Delma !il Com"an# has obtaine$ go%ernment a""ro%al to $rill
for oil in the
Bristol Channel. This area is nown to contain oil $e"osits an$
in$ustr# sources
belie%e that there is &0' chance oil will be foun$ in a
commercial %iable quantit#.
The cost of the $rilling "rogramme is belie%e$ to be ()0m* but
this coul$ be more
than o+set b# the "otential re%enue* which is "ut at (100m at
to$a#,s "rices.
The com"an# coul$ carr# out test $rillings at $i+erent sites*
which woul$ onl# cost
(&m. -rom historical $ata tests are liel# to in$icate a
%iable el$ /&' of the time.
owe%er these tests are not com"letel# reliable an$ the
"robabilit# that the# are
correct is onl# 0.. That is* if the tests are "ositi%e there is
0 ' chance that a
%iable quantit# of oil will be foun$ an$ if negati%e there is
onl# a )0 ' chance that
oil will be foun$ in a %iable quantit#.
The com"an# coul$ sell its rights to $rill in the area but the
re%enue obtaine$ will
$e"en$ on the outcome of the tests if carrie$ out3 an$ are as
follows:
Tests in$icate oil ()&m
Tests $on,t in$icate oil ()m
4o tests carrie$ out (10m
i3 Draw a $ecision tree. 596ii3 7hat $ecision shoul$ the com"an#
mae gi%en this information8
586
Question 2
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A construction "ro9ect consists of nineteen $i+erent acti%ities
$enote$ b# the letters
A* B* * 4* ;* * an$ T. The table below shows the $uration of
each acti%it# an$
which acti%ities if an#3 must "rece$e it. The "ro9ect will be
com"lete$ when the
acti%it# T is com"lete$.
a3 Construct a C.;.A.?networ to re"resent this "ro9ect*
intro$ucing a $umm#acti%it# where necessar#. 5106
b3 -in$ the earl# an$ late e%ent times for each e%ent an$ the
earliestcom"letion time for the "ro9ect.
566
c3 Calculate the total @oat time for each acti%it# an$ i$entif#
the critical "aths3.566
$3 "lain brie@# the signicance of an# critical "aths in the
management ofthe "ro9ect. 536
Acti%it# Duration $a#s3 ;rece$ing Acti%ities
A ) ?
B / ?
C ?
D & ?
/ A
- E B
F E B
E B
I 1 C
G 2 D
H * I
J * I
M / G
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4 G
; * -
< & F* H
= J* M
> ) ;* F* H
T & >* 4* u""l#
/ 11 & ) &
/ ) / & 10
-rom E / 11 1&
/ & 11
E & 12 ) E E
=equire$ E & / &
Calculate also the trans"ortation cost for each mo$el. 5106
93 There are three factories A* B an$ C which su""l# goo$s to
four $ealers D1* D2*D)an$ DE. The "ro$uction ca"acities of these
factories are 1000* 00 an$ 00
units "er month res"ecti%el#. The requirements from the $ealers
are 00* 00*&00 an$ E00 units "er month* res"ecti%el#. The
following table gi%es the unittrans"ortation costs from the
factories to the $ealers.
D1 D2 D) DE
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A 2 2 2 E
B ) & ) 2
C E ) 2 1
-ormulate this "roblem as a linear "rogramming "roblem. 56
Question
The following matri gi%es the "a#o+ of $i+erent strategies
alternati%es3 >1* >2* >)*
against con$itions e%ents3 41* 42* 4)an$ 4E.
41 42 4) 4E
>1 ?)0 ?20 ?&0 ?E0
>2 ?20 ?)0 ?)0 ?&0
>) ?10 ?)0 ?2& ?&0
In$icate the $ecision taen un$er the following a""roach b#
stating the best
strateg# for each:
a3 Maiminb3 Minimac3 Ja"lace criterion.
$3 =egret criterion
51&6
