Operations Research Answers

Discuss a few areas for application of quantitative analysis in your organization or organization you are familiar with for decision making.

Q4. Discuss a few areas for application of quantitative analysis in your organisation or

organisation you are familiar with for decision making.

The Norton Fabrication Company makes 3 products; profit per unit for each is as follows:

        P₁: P2

        P₂: P4

        P₃: P3

   Each of these products passes through three manufacturing centers as a part of the production process. Time required in each center to produce one unit of each of the three products is as follows:

                                               Hours per unit

        Product        Center 1               Center 2               Center 3

        P₁                   3                             2                             1

        P₂                   4                             1                             3

        P₃                   2                             2                             2

       Each of the three centers has time available for next week as follows:

       Center 1: 60 hours

       Center 2: 40 hours

       Center 3: 80 hours

      Determine the optimum product mix for next week’s production schedule. Use simplex linear programming.

Company C is planning to undertake another project requiring initial investment

of P50 million and is expected to generate P10 million net cash flow in Year 1,

$13 million in Year 2, P16 million in year 3, P19 million in Year 4 and P22 million

in Year 5. Calculate the payback value of the project.

4x1+2x2=40

2x1+4x2=32