OPS MGMT Week 10 Homework Assignment

Problem 1. Arsenal Electronics is going to construct a new $1.2 billion semiconductor plant and has selected four towns in the Midwest as potential sites. The important location factors and ratings for each town are as follows:

Scores (0 to 100)

Location Factor Weight Abbeton Bayside Cane Creek Dunnville

Work ethics 0.18 80 90 70 75

Quality of life 0.16 75 85 95 90

Labor laws/unionization 0.12 90 60 60 70

Infrastructure 0.10 60 50 60 70

Education 0.08 80 90 85 95

Labor skill and education 0.07 75 65 70 80

Cost of living 0.06 70 80 85 75

Taxes 0.05 65 70 55 60

Incentive package 0.05 90 95 70 80

Government regulations 0.03 40 50 65 55

Environmental regulations 0.03 65 60 70 80

Transportation 0.03 90 80 95 80

Space for expansion 0.02 90 95 90 90

Urban proximity 0.02 60 90 70 80

Recommend a site based on these location factors and ratings.

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Problem 2.

Sawyer Furniture is one of the few remaining domestic manufacturers of wood furniture. In the current competitive environment, cost containment is the key to its continued survival. Demand for furniture follows a seasonal demand pattern with increased sales in the summer and fall months, culminating with peak demand in November.

The cost of production is $16 per unit for regular production, $24 for overtime, and $33 for subcontracting. Hiring and firing costs are $500 per worker. Inventory holding costs are $20 per unit per month. There is no beginning inventory. Ten workers are currently employed. Each worker can produce 50 pieces of furniture per month. Overtime cannot exceed regular production. Given the following demand data, use Excel Solver to design an aggregate production plan for Sawyer Furniture that will meet demand at the lowest possible cost.

Input: Beg. Wkrs 10 Regular $16 Hiring $500

Units/wkr 50 Overtime $24 Firing $500

Beg. Inv. 0 Subk $33 Inventory $20

Problem 3.

Complete the following MRP matrix for Item X. Determine when orders should be released and the size of those orders.

Item: X LLC: 0 Period

Lot Size: Min 50 LT: 2 1 2 3 4 5 6 7 8

Gross Requirements 25 30 56 25 100 40 30 20

Scheduled Receipts 50

Projected on Hand 30

Net Requirements

Planned Order Receipts

Planned Order Releases

Release orders in periods 1 through 5 for quantities of 50, 50, 56, 50, and 50 respectively.

Problem 4.

Fibrous Incorporated makes products from rough tree fibers. Its product line consists of five items processed through one of five machines. The machines are not identical, and some products are better suited to some machines. Given the following production time in minutes per unit, determine an optimal assignment of product to machine:

Machine

Product A B C D E

1 17 10 15 16 20

2 12 ?9 16 ?9 14

3 11 16 14 15 12

4 14 10 10 18 17

5 13 12 ?9 15 11

Problem 5.

The following probabilistic activity time estimates are for a CPM/PERT network.

Time Estimates (days) Time Estimates (days)

Activity a m b Activity a m b

1 1 2 ?6 ?7 1 1.5 2

2 1 3 ?5 ?8 1 3 5

3 3 5 10 ?9 1 1 5

4 3 6 14 10 2 4 9

5 2 4 ?9 11 1 2 3

6 2 3 ?7 12 1 1 1

Determine the following:

a. Expected activity times is in Mean column

b. Earliest start and finish times

c. Latest start and finish times

d. Activity Slack

e. Critical Path

f. Expected Project duration and standard deviation.