List of Assignments

Research assignment 1: Queuing theory
- In the case of choosing this topic, it is necessary for students to analyze the selected service
system. Students independently choose the service system, the time when the system is observed
and collect data about the system. Systems that can be analyzed include: banks, post office,
student services, gas stations, car washes, different shops, traffic or any system which could be
interesting to analyze queues. The choice of system and application of the topic must be
registered on the site (with the approval of the teacher or associate).
- The structure of the assignment should include:
o About the system - the part in which it is necessary to present the selected service system,
its characteristics, the time of observation and the data collection method, and the data
that define the system.
o System analysis - based on the input data, students should determine the system
parameters and assess the system's stability. After that, for the existing real situation,
determine basic information about the average number of clients in system, waiting time,
capacity utilization, and some specific probabilities that you consider important in the
analysis.
o Sensitive analysis – sensitive analysis implies the analysis of a change in one parameter,
while the others are fixed (eg what if the intensity of arrivals increases). It is necessary to
analyze the changes in system characteristics in accordance with the change in
parameters. The elements on which a sensitivity analysis should be performed are the
number of stations, the number of clients and the number of services. Students should
also provide appropriate graphic presentations and interpretations. Students can
arbitrarily analyze other aspects that are interesting to them.
o Conclusion - in this part you need to refer to the system analysis, sensitive analysis and
give certain conclusions and recommendations. Students should also look at the
economic aspect in terms of the cost of waiting and the cost of stations and make
recommendations.
- The assignment can contain a maximum of 5,000 words.

Research assignment 2: Inventories (EOQ models)
- In the case of choosing this topic, it is necessary for the student to analyze the use of the EOQ
model in the management of stocks of some product, and the importance of safety stocks. It is
necessary to select a finished product and determine the ordering policy for that product (identify
all elements necessary for the EOQ model, the assumption that is taken into account is the
uniform distribution of the demand for that product). The information necessary for the analysis
must be collected from interviews with employees (report the sources for the collected data). The
choice of product and application of the topic must be registered on the site (with the approval of
the teacher or associate).
- The structure of the assignment should include:
o Description of the problem - the part in which it is necessary to present the selected
product and the context of the inventory policy that the given product currently has.
Identify all parameters needed for EOQ decision models.
o Problem analysis - on the basis of the identified parameters, it is necessary to determine
the optimal inventory management policy, and compare the costs of the current policy
with the optimal decision. Analyze safety stocks in particular: do they exist and how
would they change in the optimal case. Provide a graphical presentation of inventory
management costs.
o Sensitive analysis - since the assumption of a uniform distribution of demand for the
finished product is mostly not met, it is necessary to make a demand simulation in Excel
(select a parameter) for a longer period of time (you can repeat it several times), in order
to check the current policy of inventory management, optimal the politics and impact of
safety stocks. Students can arbitrarily analyze other aspects that are interesting to them.
o Conclusion - in this part, you need to refer to the problem analysis and sensitive analysis
and give certain conclusions and recommendations.
- The assignment can contain a maximum of 5,000 words.

Case study 1 (Linear programming)
(Animal feed mix problem) The Battery Park Stable feeds and houses the horses used to pull
tourist-filled carriages through the streets of Charleston’s historic waterfront area. The stable
owner, an ex-racehorse trainer, recognizes the need to set a nutritional diet for the horses in his
care. At the same time, he would like to keep the overall daily cost of feed to a minimum. The
feed mixes available for the horses’ diet are an oat product, a highly enriched grain, and a
mineral product. Each of these mixes contains a certain amount of five ingredients needed daily
to keep the average horse healthy. The table on this page shows these minimum requirements,
units of each ingredient per pound of feed mix, and costs for the three mixes. In addition, the
stable owner is aware that an overfed horse is a sluggish worker. Consequently, he determines
that 6 pounds of feed per day are the most that any horse needs to function properly. Formulate
this problem and solve for the optimal daily mix of the three feeds.
You should form model of LP (primal model), form dual model, calculate all values of primal
and dual variables, give a interpretation for all of them and make full post optimal analysis.
(Investment decision problem) The Heinlein and Krampf Brokerage firm has just been
instructed by one of its clients to invest $250,000 of her money obtained recently through the
sale of land holdings in Ohio. The client has a good deal of trust in the investment house, but she
also has her own ideas about the distribution of the funds being invested. In particular, she
requests that the firm select whatever stocks and bonds they believe are well rated, but within the
following guidelines:
(a) Municipal bonds should constitute at least 20% of the investment.
(b) At least 40% of the funds should be placed in a combination of electronic firms, aerospace
firms, and drug manufacturers.
(c) No more than 50% of the amount invested in municipal bonds should be placed in a high-
risk, high-yield nursing home stock.
Subject to these restraints, the client’s goal is to maximize projected return on investments. The
analysts at Heinlein and Krampf, aware of these guidelines, prepare a list of high-quality stocks
and bonds and their corresponding rates of return:
Eddie Kelly is running for reelection as mayor of a small town in Alabama. Jessica Martinez,
Kelly’s campaign manager during this election, is planning the marketing campaign, and there is
some stiff competition. Martinez has selected four ways to advertise: television ads, radio ads,
billboards, and newspaper ads. The costs of these, the audience reached by each type of ad, and
the maximum number of each is shown in the following table:
In addition, Martinez has decided that there should be at least six ads on TV or radio or some
combination of those two. The amount spent on billboards and newspapers together must not
exceed the amount spent on TV ads. While fundraising is still continuing, the monthly budget for
advertising has been set at $15,000. How many ads of each type should be placed to maximize
the total number of people reached?
(High school busing problem) The Arden County, Maryland, superintendent of education is
responsible for assigning students to the three high schools in his county. He recognizes the need
to bus a certain number of students, for several sectors of the county are beyond walking distance
to a school. The superintendent partitions the county into five geographic sectors as he attempts
to establish a plan that will minimize the total number of student miles traveled by bus. He also
recognizes that if a student happens mto live in a certain sector and is assigned to the high school
in that sector, there is no need to bus that student because he or she can walk to school. The three
schools are located in sectors B, C, and E.
The following table reflects the number of highschool- age students living in each sector and the
distance in miles from each sector to each school:
Each high school has a capacity of 900 students. Set up the objective function and constraints of
this problem using LP so that the total number of student miles traveled by bus is minimized.
(Note the resemblance to the transportation problem illustrated earlier in this chapter.) Then
solve the problem.
(College meal selection problem) Kathy Roniger, campus dietitian for a small Idaho college, is
responsible for formulating a nutritious meal plan for students. For an evening meal, she feels
that the following five meal-content requirements should be met: (1) between 900 and 1,500
calories; (2) at least 4 milligrams of iron; (3) no more than 50 grams of fat; (4) at least 26 grams
of protein; and (5) no more than 50 grams of carbohydrates. On a particular day, Roniger’s food
stock includes seven items that can be prepared and served for supper to meet these
requirements. The cost per pound for each food item and the contribution to each of the five
nutritional requirements are given in the table below. What combination and amounts of food
items will provide the nutrition Roniger requires at the least total food cost?
(a) Formulate as an LP problem.
(b) What is the cost per meal?
(c) Is this a well-balanced diet?
(Material blending problem) Amalgamated Products has just received a contract to construct
steel
body frames for automobiles that are to be produced at the new Japanese factory in Tennessee.
The Japanese auto manufacturer has strict quality control standards for all of its component
subcontractors and has informed Amalgamated that each frame must have the following steel
content:
Amalgamated mixes batches of eight different available materials to produce one ton of steel
used in the body frames. The table on this page details these materials. Formulate and solve the
LP model that will indicate how much each of the eight materials should be blended into a 1-ton
load of steel so that Amalgamated meets its requirements while minimizing costs.
and dual variables, give a interpretation for all of them and make full post optimal analysis. Find
the cause of the difficulty and recommend how to adjust it. Then solve the problem again.
(Hospital expansion problem) Mt. Sinai Hospital in New Orleans is a large, private, 600-bed
facility, complete with laboratories, operating rooms, and x-ray equipment. In seeking to increase
revenues, Mt. Sinai’s administration has decided to make a 90- bed addition on a portion of
adjacent land currently used for staff parking. The administrators feel that the labs, operating
rooms, and x-ray department are not being fully utilized at present and do not need to be
expanded to handle additional patients. The addition of 90 beds, however, involves deciding how
many beds should be allocated to the medical staff for medical patients and how many to the
surgical staff for surgical patients. The hospital’s accounting and medical records departments
have provided the following pertinent information. The average hospital stay for a medical
patient is 8 days, and the average medical patient generates $2,280 in revenues. The average
surgical patient is in the hospital 5 days and receives a $1,515 bill. The laboratory is capable of
handling 15,000 tests per year more than it was handling. The average medical patient requires
3.1 lab tests and the average surgical patient takes 2.6 lab tests. Furthermore, the average medical
patient uses one x-ray, whereas the average surgical patient requires two x-rays. If the hospital
was expanded by 90 beds, the x-ray department could handle up to 7,000 x-rays without
significant additional cost. Finally, the administration estimates that up to 2,800 additional
operations could be performed in existing operating room facilities. Medical patients, of course,
do not require surgery, whereas each surgical patient generally has one surgery performed.
Formulate this problem so as to determine how many medical beds and how many surgical beds
should be added to maximize revenues. Assume that the hospital is open 365 days a year. Then
solve the problem.
(Portfolio selection problem) Daniel Grady is the financial advisor for a number of professional
athletes. An analysis of the long-term goals for many of these athletes has resulted in a
recommendation to purchase stocks with some of their income that is set aside for investments.
Five stocks have been identified as having very favorable expectations for future performance.
Although the expected return is important in these investments, the risk, as measured by the beta
of the stock, is also important. (A high value of beta indicates that the stock has a relatively high
risk.) The expected return and the betas for five stocks are as follows:
Daniel would like to minimize the beta of the stock portfolio (calculated using a weighted
average of the amounts put into the different stocks) while maintaining an expected return of at
least 11%. Since future conditions may change, Daniel has decided that no more than 35% of the
portfolio should be invested in any one stock.
(a) Formulate this as a linear program. (Hint: Define the variables to be the proportion of the
total investment that would be put in each stock. Include a constraint that restricts the sum of
these variables to be 1.)
(b) Solve this problem. What are the expected return and beta for this portfolio?
(Airline fuel problem) Coast-to-Coast Airlines is investigating the possibility of reducing the
cost of fuel purchases by taking advantage of lower fuel costs in certain cities. Since fuel
purchases represent a substantial portion of operating expenses for an airline, it is important that
these costs be carefully monitored. However, fuel adds weight to an airplane, and consequently,
excess fuel raises the cost of getting from one city to another. In evaluating one particular flight
rotation, a plane begins in Atlanta, flies from Atlanta to Los Angeles, from Los Angeles to
Houston, from Houston to New Orleans, and from New Orleans to Atlanta. When the plane
arrives in Atlanta, the flight rotation is said to have been completed, and then it starts again.
Thus, the fuel on board when the flight arrived in Atlanta must be taken into consideration when
the flight begins. Along each leg of this route, there is a minimum and a maximum amount of
fuel that may be carried. This and additional information is provided in the table on this page.
The regular fuel consumption is based on the plane carrying the minimum amount of fuel. If
more than this is carried, the amount of fuel consumed is higher. Specifically, for each 1,000
gallons of fuel above the minimum, 5% (or 50 gallons per 1,000 gallons of extra fuel) is lost due
to excess fuel consumption. For example, if 25,000 gallons of fuel were on board when the plane
takes off from Atlanta, the fuel consumed on this route would be thousand gallons. If 26
thousand gallons were on board, the fuel consumed would be increased by another 0.05
thousand, for a total of 12.1 thousand gallons. Formulate this as an LP problem to minimize the
cost. How many gallons should be purchased in each city? What is the total cost of this?
(High-tech production problem) Quitmeyer Electronics Incorporated manufactures the
following six microcomputer peripheral devices: internal modems, external modems, graphics
circuit boards, CD drives, hard disk drives, and memory expansion boards. Each of these
technical products requires time, in minutes, on three types of electronic testing equipment, as
shown in the table on the next page. The first two test devices are available 120 hours per week.
The third (device 3) requires more preventive maintenance and may be used only 100 hours each
week. The market for all six computer components is vast, and Quitmeyer Electronics believes
that it can sell as many units of each product as it can manufacture. The table that follows
summarizes the revenues and material costs for each product:
In addition, variable labor costs are $15 per hour for test device 1, $12 per hour for test device 2,
and $18 per hour for test device 3. Quitmeyer Electronics wants to maximize its profits.
(a) Formulate this problem as an LP model.
(b) Solve the problem by computer. What is the best product mix?
(c) What is the value of an additional minute of time per week on test device 1? Test device 2?
Test device 3? Should Quitmeyer Electronics add more test device time? If so, on which
equipment?
Case study 11 (Transportation problem)
The B. Hall Real Estate Investment Corporation has identified four small apartment buildings in
which it would like to invest. Mrs. Hall has approached three savings and loan companies
regarding financing. Because Hall has been a good client in the past and has maintained a high
credit rating in the community, each savings and loan company is willing to consider providing
all or part of the mortgage loan needed on each property. Each loan officer has set differing
interest rates on each property (rates are affected by the neighborhood of the apartment building,
condition of the property, and desire by the individual savings and loan to finance various-size
buildings), and each loan company has placed a maximum credit ceiling on how much it will
lend Hall in total. This information is summarized in the table on this page. Each apartment
building is equally attractive as an investment to Hall, so she has decided to purchase all
buildings possible at the lowest total payment of interest.
a) Formulate this problem as a linear programming model.

b) From which savings and loan companies should she borrow to purchase which buildings?
More than one savings and loan can finance the same property.
c) If First Homestead doesn't want to borrow from Banks St., and Washington Federal doesn't
want to borrow from Drury Lane, what does the new borrowing plan look like?
d) If a new loan company appears on the market, called New Bank, which is ready to offer a
$100,000 credit line at an interest rate of 9% (regardless of the property), how will this affect
the optimal plan?
Marc Smith, vice president for operations of HHN, Inc., a manufacturer of cabinets for telephone
switches, is constrained from meeting the 5-year forecast by limited capacity at the existing three
plants. These three plants are Waterloo, Pusan, and Bogota. You, as his able assistant, have been
told that because of existing capacity constraints and the expanding world market for HHN
cabinets, a new plant is to be added to the existing three plants. The real estate department has
advised Marc that two sites seem particularly good because of a stable political situation and
tolerable exchange rate: Dublin, Ireland, and Fontainebleau, France. Marc suggests that you
should be able to take the data in the next table and determine where the fourth plant should be
located on the basis of production costs and transportation costs. Which location is better?

b) Solve this and analyze optimal solution. What is optimal plan?
c) Is there any meaningfull interpretation of dual variables? Explain.
d) Is there any change in optimal plan if there is prohibition of transport between Pusan and
Pacific Rim?

b) Set up the transportation tableau for this problem. Find optimal solution. Compute the
total minimum cost.
c) There is a new trucking firm in St. Marry with demand 30 and same transportation cost
per engine 500$ for each plant. But, there is prohibition of transport between Detroit and
this firm. Would this change optimal plan?
A severe winter ice storm has swept across North Carolina and Virginia, followed by over a foot
of snow and frigid, single-digit temperatures. There weather conditions have resulted in
numerous downed power lines and lower outages in the region causing dangerous conditions for
much of the population. Local utility companies have been overwhelmed and have requested
assistance form unaffected utility companies across the Southeeast. The following table shows
the number of utility trucks with crews avalable from five different companies in Georga, South
Carolina, and Florida; the demand for crews in seven different areas that local companies cannot
get to; and the weekly cost ($1000s) of a crew going to a specific area (based on the visiting
company's normal charges, the distance the crew has to come, and living expenses in an area).

b) Determine the number of crews that should be sent from each utlity to each affected area
that will minimize total cost.
c) Is there any meaningfull interpretation of dual variables? Explain. Make post-optimal
analysis if possible.
(Hospital food transportation problem) Northeast General, a large hospital in Providence,
Rhode Island, has initiated a new procedure to ensure that patients receive their meals while the
food is still as hot as possible. The hospital will continue to prepare the food in its kitchen but
will now deliver it in bulk (not individual servings) to one of three new serving stations in the
building. From there, the food will be reheated and meals will be placed on individual trays,
loaded onto a cart, and distributed to the various floors and wings of the hospital. The three new
serving stations are as efficiently located as possible to reach the various hallways in the hospital.
The number of trays that each station can serve are indicated in the table:
There are six wings to Northeast General that must be served. The number of patients in each
follows:
The purpose of the new procedure is to increase thetemperature of the hot meals that the patient
receives. Therefore, the amount of time needed to deliver a tray from a serving station will
determine the proper distribution of food from serving station to wing. The following table
summarizes the time (minutes) associated with each possible distribution channel. What is your
recommendation for handling the distribution of trays from the three serving stations?

b) What is your recommendation for handling the distribution of trays from the three
serving stations? Find an optimal plan.
c) If wing 6 is closed because of fire demage, what is a new optimal plan?
d) Is there any meaningfull interpretation of dual variables? Explain.
The Krampf Lines Railway Company specializes in coal handling. On Friday, April 13, Krampf
had empty cars at the following towns in the quantities indicated:
By Monday, April 16, the following towns will need coal cars as follows:
Using a railway city-to-city distance chart, the dispatcher constructs a mileage table for the
preceding towns. The result is shown in the table below. Minimizing total miles over which cars
are moved to new locations, compute the best shipment of coal cars.

b) Find an optimal plan.
c) If need for cars is increased in Coaltown from 45 to 50, how will this affect optimal plan?
d) If transport from Youngstown to Coal Junction is prohibited, find new optimal plan.
Case study 17 (Assignment problem)
Baseball umpiring crews are currently in four cities where three-game series are beginning.
When these are finished, the crews are needed to work games in four different cities. The
distances (miles) from each of the cities where the crews are currently working to the cities
where the new games will begin are shown in the following table:
Formulate this assignment problem as linear programming problem.
The X indicates that the crew in Oakland cannot be sent to Toronto. Determine which crew
should be sent to each city to minimize the total distance traveled. How many miles will be
traveled if these assignments are made?
NASA’s astronaut crew currently includes 10 mission specialists who hold a doctoral degree in
either astrophysics or astromedicine. One of these specialists will be assigned to each of the 10
flights scheduled for the upcoming nine months. Mission specialists are responsible for carrying
out scientific and medical experiments in space or for launching, retrieving, or repairing
satellites. The chief of astronaut personnel, himself a former crew member with three missions
under his belt, must decide who should be assigned and trained for each of the very different
missions. Clearly, astronauts with medical educations are more suited to missions involving
biological or medical experiments, whereas those with engineering- or physics-oriented degrees
are best suited to other types of missions. The chief assigns each astronaut a rating on a scale of 1
to 10 for each possible mission, with a 10 being a perfect match for the task at hand and a 1
being a mismatch. Only one specialist is assigned to each flight, and none is reassigned until all
others have flown at least once.
a) Formulate this problem as a assignment model.

b) Who should be assigned to which flight?
c) NASA has just been notified that Anderson is getting married in February and has been
granted a highly sought publicity tour in Europe that month. (He intends to take his wife
and let the trip double as a honeymoon.) How does this change the final schedule?
d) Certo has complained that he was misrated on his January missions. Both ratings should
be10s, he claims to the chief, who agrees and recomputes the schedule. Do any changes
occur over the schedule set in part (b)?
e) What are the strengths and weaknesses of this approach to scheduling?
Roscoe Davis, chairman of a college’s business department, has decided to apply a new method
in assigning professors to courses next semester. As a criterion for judging who should teach
each course, Professor Davis reviews the past two years’ teaching evaluations (which were filled
out by students). Since each of the four professors taught each of the four courses at one time or
another during the two year period, Davis is able to record a course rating for each instructor.
These ratings are shown in the table. Find the best assignment of professors to courses to
maximize the overall teaching rating.
a) Formulate this problem as a assignment model.

b) Who should be assigned to which course?
c) If Anderson cannot be sent to Economic or Finance and Williams doesn’t like
Management, so he doesn’t want to go on that cours, would optimal plan change?
There are 6 cities in a region. The government of that region decides in which cities to build fire
stations. The goal is to make the greatest possible savings and build as few fire stations as
possible, but the condition is that at least one station should be within a 15-minute drive from
each city. The distance between cities, expressed in driving minutes, is given in the following
table:
Form a linear programming model to determine how many fire stations should be built and
where they should be located to meet the given conditions. Find optimal solution.
Is there any meaningfull interpretation of dual variables? Explain.
Case study 21 (Project management)
Tom Schriber, a director of personnel of Management Resources, Inc., is in the process of
designing a program that its customers can use in the job-finding process. Some of the activities
include preparing resumés, writing letters, making appointments to see prospective employers,
researching companies and industries, and so on. Some of the information on the activities is
shown in the following table:
a) Construct a network for this problem. Also, present a project by Gantt chart.
b) Determine the expected time and variance for each activity.
c) Determine ES, EF, LS, LF, and slack for each activity. Explain it. Determine the critical
path and project completion time.
d) Management Resources, Inc. has 5 employees. Each worker can perform any activity. Let's
assume that we need 2 workers for each activity. How will this affect project completion
time? If the daily wage for each worker who works on an activity is $100, what will be the
labor costs on this project?
Dream Team Productions was in the final design phases of its new film, Killer Worms, to be
released next summer. Market Wise, the firm hired to coordinate the release of Killer Worms
toys, identified 16 critical tasks to be completed before the release of the film.
b) How many weeks in advance of the film release should Market Wise start its marketing
campaign?
c) What are the critical path activities? Determine ES, EF, LS, LF, and slack for each activity.
Explain it.
d) Company has 7 employees which can perform any preparation activity from the list. Let's
The tasks are as follows:
b) What is project duration time? What are the critical path activities? Determine ES, EF, LS,
LF, and slack for each activity. Explain it.
c) Company has 10 employees which can perform any preparation activity from the list. Let's
assume that we need 3 workers for each A-G activity, and 5 workers for each H-N activity.
How will this affect project completion time? If the daily wage for each worker who works
on an activity is $100, what will be the labor costs on this project?
(Southwestern University Stadium Construction) After six months of study, much political arm
wrestling, and some serious financial analysis, Dr. Martin Starr, president of Southwestern
University, had reached a decision. To the delight of its students, and to the disappointment of its
athletic boosters, SWU would not be relocating to a new football site but would expand the
capacity at its on-campus stadium. Adding 21,000 seats, including dozens of luxury skyboxes,
would not please everyone. The influential football coach, Bo Pitterno, had long argued the need
for a first-class stadium, one with built-in dormitory rooms for his players and a palatial office
appropriate for the coach of a future NCAA champion team. But the decision was made, and
everyone, including the coach, would learn to live with it. The job now was to get construction
going immediately after the current season ended. This would allow exactly 270 days until the
upcoming season opening game. The contractor, Hill Construction (Bob Hill being an alumnus,
of course), signed the contract. Bob Hill looked at the tasks his engineers had outlined and
looked President Starr in the eye. “I guarantee the team will be able to take the field on schedule
next year,” he said with a sense of confidence. “I sure hope so,” replied Starr. “The contract
penalty of $10,000 per day for running late is nothing compared to what Coach Pitterno will do
to you if our opening game with Penn State is delayed or cancelled.” Hill, sweating slightly, did
not respond. In football-crazy Texas, Hill Construction would be mud if the 270-day target were
missed. Back in his office, Hill again reviewed the data. (See Table 12.11 and note that
optimistic time estimates can be used as crash times.) He then gathered his foremen. “People, if
we’re not 75% sure we’ll finish this stadium in less than 270 days, I want this project crashed!
Give me the cost figures for a target date of 250 days—also for 240 days. I want to be early, not
just on time!”
1. Develop a network drawing for Hill Construction and determine the critical path. How
long is the project expected to take?
2. Determine ES, EF, LS, LF, and slack for each activity. Explain it. Determine the critical
path.
3. What is the probability of finishing in 270 days?
4. If it were necessary to crash to 250 or 240 days, how would Hill do so, and at what costs?
As noted in the case, assume that optimistic time estimates can be used as crash times.

(Family Planning Research Center of Nigeria) Dr. Adinombe Watage, deputy director of the
Family Planning Research Center in Nigeria’s Over-the-River Province, was assigned the task of
organizing and training five teams of field workers to perform educational and outreach activities
as part of a large project to demonstrate acceptance of a new method of birth control. These
workers already had training in family planning education but must receive specific training
regarding the new method of contraception. Two types of materials must also be prepared: (1)
those for use in training the workers, and (2) those for distribution in the field. Training faculty
must be brought in and arrangements made for transportation and accommodations for the
participants. Dr. Watage first called a meeting of his office staff. Together they identified the
activities that must be carried out, their necessary sequences, and the time that they would
require. Their results are displayed in table:
Louis Odaga, the chief clerk, noted that the project had to be completed in 60 days. Whipping
out his solar-powered calculator, he added up the time needed. It came to 94 days. “An
impossible task, then,” he noted. “No,” Dr. Watage replied, “some of these tasks can go forward
in parallel.” “Be careful, though,” warned Mr. Oglagadu, the chief nurse, “there aren’t that many
of us to go around. There are only 10 of us in this office.” “I can check whether we have enough
heads and hands once I have tentatively scheduled the activities,” Dr. Watage responded. “If the
schedule is too tight, I have permission from the Pathminder Fund to spend some funds to speed
it up, just so long as I can prove that it can be done at the least cost necessary. Can you help me
prove that? Here are the costs for the activities with the elapsed time that we planned and the
costs and times if we shorten them to an absolute minimum.” Those data are given in table:
1. Some of the tasks in this project can be done in parallel. Prepare a diagram showing the
required network of tasks and define the critical path. What is the length of the project without
crashing?
2. At this point, can the project be done given the personnel constraint of 10 persons?
3. If the critical path is longer than 60 days, what is the least amount that Dr. Watage can spend
and still achieve this schedule objective? How can he prove to Pathminder Foundation that this is
the minimum-cost alternative?
The Bender Construction Co. is involved in constructing municipal buildings and other
structures that are used primarily by city and state municipalities. This requires developing legal
documents, drafting feasibility studies, obtaining bond ratings, and so forth. Recently, Bender
was given a request to submit a proposal for the construction of a municipal building. The first
step is to develop legal documents and to perform all steps necessary before the construction
contract is signed. This requires more than 20 separate activities that must be completed. These
activities, their immediate predecessors, and time requirements are given in table below.
As you can see, optimistic (a), most likely (m), and pessimistic (b) time estimates have been
given
for all of the activities described in the table. Using the data, determine the total project
completion time for this preliminary step, the critical path, and slack time for all activities
involved.
b) Determine the expected time and variance for each activity.
c) Determine ES, EF, LS, LF, and slack for each activity. Explain it. Determine the critical
path and project completion time.
d) Bender Construction Co. has 10 employees. Each worker can perform any activity. Let's
Case study 28 (Inventories)

Lisa Surowsky was asked to help in determining the best ordering policy for a new product.
Currently, the demand for the new product has been projected to be about 1,000 units annually.
To get a handle on the carrying and ordering costs, Lisa prepared a series of average inventory
costs. Lisa thought that these costs would be appropriate for the new product. The results are
summarized in the following table. These data were compiled for 10,000 inventory items that
were carried or held during the year and were ordered 100 times during the past year.
Help Lisa determine the EOQ.
a) Allocate the costs and determine the unit prices necessary for the EOQ model.
b) Graphically present the costs depending on the number of orders or the size of the order.
c) Determine the optimal inventory management policy (all elements of the optimal decision).
d) Make a sensitive analysis.
Case study 29 (Production function)
On a sample of 24 companies in the textile industry, information on the amount of capital and
labor consumption and the amount of output produced was collected and presented in the table.
Company Output (Q) Capital (K) Labor (L)
1 200 200 200
2 202 200 210
3 224 214 220
4 244 228 236
5 248 244 246
6 244 262 232
7 286 276 250
8 304 298 266
9 302 326 276
10 252 352 242
11 310 370 280
12 318 396 288
13 306 416 290
14 354 432 304
15 368 452 308
16 338 472 298
17 378 488 308
18 450 532 364
19 454 596 392
20 446 670 400
21 436 732 386
22 462 774 386
23 358 814 294
24 480 834 322
a) Using the assumption that it is a Cobb-Douglas production function (Q= A ⋅ K α ⋅ L β) evaluate

the production function. Use MS Excel-ov Data Analysis Toolpack (Tools → Data analysis → Regression).
Hint: it is necessary to linearize the given form of the Cobb-Douglas function:
ln(Q) = ln ( A⋅K α⋅Lβ )

ln (Q )= ln A + ln( K α ) + ln( L β )
Q = A⋅K α⋅Lβ ln(Q)= ln A + α⋅ln K + β⋅ln L
→
That is, use logarithmic data.
b) Interpret the results of the evaluated model.
c) Graphically display the isoquants Q=200, Q=300, Q=400
d) Determine and explain the marginal rate of substitution at the level of labor L = 300 and
capital K = 600 and explain the meaning.
e) If the price of labor is twice less than the price of capital, determine the path of expansion.
Case study 30 (Economic functions)
(Graphic house „Book“) Graphic house "Book" estimated the costs of printing and binding a set
of books for the needs of the City Library in one cycle. It was determined that the fixed costs are
F = 400 KM. The variable costs of producing x sets of books are recorded in the table:
Number of books set - x 1 2 4 5 7 10 15
Variable cost 20 38 72 85 112 180 300
Estimate the variable cost function using the assumption that the functional form is linear and
quadratic. (Note you can use Excel scatter and trend tools)
Based on the both estimated functions, determine
a) How many sets of books should be produced to minimize the average cost of production?
b) If the market price of a set of books is 120 KM, how many sets would be best to print? Why?
c) Would the business be profitable if you offered 10 sets of books at this price p = 120 KM?
d) Determine the lowest price at which the optimal offer would provide the graphics company
"Book" with profitable business? Explain the answer with a graphic representation.
(Firm that produces medical equipment) Suppose you are hired as a consultant for some firm
that produces medical equipment. Your task is to analyze their operations. Since a decision on
price is off the table for a firm in a competitive market, the profit-maximization decision boils
down into decisions about the quantity produced. To be able to make this decision optimally, you
need to determine and analyze the firm’s profit. Since profit is the difference between revenue
and costs, your first step will be to analyze the revenue function of a firm. The firm is operating
in a competitive market and charges a market price for its product which is fixed at a level of
9350 euros. Total revenue at a different level of output produced is presented in Table (in 00
euros).
Output y 0 1 2 3 4 5 6 7 8
Market price (p) 93.5 93.5 93.5 93.5 93.5 93.5 93.5 93.5 93.5
Total revenue 0 93.5 187 280.5 374 467.5 561 654.5 749
MR=AR=p - 93.5 93.5 93.5 93.5 93.5 93.5 93.5 93.5
Besides the revenue, the next step in your analysis is the analysis of their costs structure. You
started by gathering the data on the values of fixed and variable costs at a different level of
output. The results are presented in Table. All values are expressed in euros (in 00).
Output q 0 1 2 3 4 5
Fixed cost (FC or F) 75 75 75 75 75 75
Variable cost (VC or V) 0 18.5 62 130.5 224 342.5
Total cost (C or TC) FC+VC 75 93.5 137 205.5 299 417.5
• Generate a scatter chart with markers only for the cost function, add a quadratic trend, and
show the equation on the chart. Compare your results with linear regression type
• Find the equation of the revenue function. Complete the break-even analysis table by
entering the Excel expressions for the cost and revenue. Generate a break-even scatter
chart illustrating the cost and revenue functions. (For analysis use both previously
selected function expression for cost)
• Answer:
• What is the minimum number of medical equipment that must be sold to make a profit?
• What is the maximum number of medical equipment that can be sold and still make a
profit?
• How many medical equipment should be sold to maximize the profit and what is the
maximum profit?
• What range of prices will result in a profit? What price will result in the maximum
profit and what is that maximum profit?
• If market price decrease 30% analyse influence on your decision.
(The buffalo steak dinner problem) Restaurant wants to introduce a new buffalo steak dinner
Test prices (Note these are unit prices):
Price $14.95 $19.95 $24.95 $29.95
Number sold per week 2 800 2 300 1 600 300
Demand part
Determine demand function q = f(p) using regression tools and calculate inverse demand
p = D(q). Choose two type linear and quadratic form of the function for proceeding analysis.
(Note you can use Excel scatter and trend tools)
For both selected fuction calculate and explain:
What price is “to much” i.e. for what price demand stopped?
What is approximately changes in number sold per week if price p=24.95 increase by 1% in both
cases.
Revenue part
Analyze amount that producer receives from the sale of q units and calculate producer revenue
function. Present graphically revenue function for both cases.
Cost part
A producer’s total cost function, C(q), for the production of q units is given by
C(q) = C0 + VC(q) = fixed cost + variable cost
Table below contains variable cost information.
If we assume that there are linear variable cost over a range of values for q between 1,000 and
3,000 and fixed cost C0 = $9,000.00, determine total weekly cost function, for the buffalo steak
dinners.
If we assume that there are VC(q) = a*ln(q) + b over a range of values for q between 1,000 and
3,000 and fixed cost C0 = $9,000.00, determine total weekly cost function, for the buffalo steak
dinners.
Number of Dinners(q) 1,000 2,000 3,000

VC(q) $21,000.00 $30,000.00 $36,000.00
Profit part
Let P(q) be the profit obtained from producing and selling q units of a good at the price D(q):
Profit = Revenue  Cost or P(q) = R(q)  C(q)
Determine and analyze best decision for restaurant. (Use graphical interpretation if possible)
(The treadmills case) The table below contains price, demand and total cost data for the
production of treadmills where: x is the number of treadmills sold, Price is the price per
treadmill in dollars, and Cost is the total cost in dollars of producing x treadmills.
x Price Cost
2000 1700 3500000
2225 1650 3520000
2549 1500 3650000
2910 1435 3850000
3415 1280 4000000
3825 1210 4590000
4000 1190 4980000
4645 1125 5850000
5200 910 6650000
5500 850 7100000
• Generate a scatter chart with markers only for the price function, add a linear trend, and
show the equation on the chart. Compare your results with another regression type. For
analysis use at least two different function expressions. (Note you can use Excel scatter and
trend tools)
• Generate a scatter chart with markers only for the cost function, add a linear trend line, and
show the equation on the chart. Compare your results with another regression type (i.e., use
a different function form)
• Find the equation of the revenue function. Complete the break-even analysis table by
entering the Excel expressions for the cost and revenue. Generate a break-even scatter chart
illustrating the cost and revenue functions. (For analysis use previously selected function
expression for cost and demand)
• Answer:
• What is the minimum number of treadmills that must be sold to make a profit?
• What is the maximum number of treadmills that can be sold and still make a profit?
• How many treadmills should be sold to maximize the profit and what is the maximum
profit?
• What range of prices will result in a profit? What price will result in the maximum profit
and what is that maximum profit?

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Research assignment 1: Queuing theory

- The structure of the assignment should include:

- The assignment can contain a maximum of 5,000 words.

- The structure of the assignment should include:

- The assignment can contain a maximum of 5,000 words.

a) Formulate this problem as a linear programming model.

a) Formulate this problem as a linear programming model.

a) Formulate this problem as a linear programming model.

a) Formulate this problem as a linear programming model.

a) Formulate this problem as a linear programming model.

a) Formulate this problem as a linear programming model.

Formulate this assignment problem as linear programming problem.

a) Formulate this problem as a assignment model.

a) Formulate this problem as a assignment model.

Case study 26 (Project management)

Case study 28 (Inventories)

a) Using the assumption that it is a Cobb-Douglas production function (Q= A ⋅ K α ⋅ L β) evaluate

ln(Q) = ln ( A⋅K α⋅Lβ )

Number of Dinners(q) 1,000 2,000 3,000

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