New Global Vision College

Group Assignment for the course Quantitative Analysis for Managerial Decision
N. B The group members should be minimum of 10 and Maximum 11 students (20
Marks)
Question #1
Consider a transportation problem faced by ABC Company. This problem involves the
transportation of a product from three plants of the company to three distribution centres. The
company has plants in Mekelle, Hawasa and Gambela. Monthly production capacities of a
certain product at these plants are as follows:
Origin Factory Monthly production capacity
(units)
1 Mekele 100
2 Hawasa 300
3 Gambela 300
Total=700 units
The Company distributes the product through three distribution centres located in Addis Ababa,
Gondar and Jijiga. A monthly forecast of demand for these distribution centres is as follows:
Destination Distribution Centre Monthly demand forecast (units)
1 Addis Ababa 300
2 Gondar 200
3 Jijiga 200
Total=700 units
The following table indicates transportation cost (in Br.) per unit of the good from each source
to each destination along with the supply capacity and demand of the origins and destinations:
Destination
Origin Addis Ababa Gondar Jijiga Supply

Mekele 5 4 3 100

Hawasa 8 4 3 300

Gambela 9 7 5 300

Demand 300 200 200 700

The company would like to determine how much product should be shipped from each source to
each destination in such a way that the demand of each destination is satisfied with the available
production at each source and the overall transportation cost is minimized. Note that total
demand and total supply are equal: 700 units.

Required:

A. Develop the General Linear Programming Model for the above transportation problem
B. Find the optimum solution/minimize the transportation cost of the above transportation
problem by using;
i. North West Method
ii. Lowest Cost Method.
iii. Vogel’s Approximation method.
C. Test for post optimality by using MODI method.

Note: You can choose the lowest total cost from the three solution method in B
(NWM, LCM and VAM) to start with its final tableau.

Question #2
Develop an initial feasible solution using LCM

R S T Supply

A 1 2 3 100

B 4 1 5 110

Demand 80 120 60
Question #3
A computer centre has three programmers. The centre wants three application programs to be
developed. The head of the computer centre, after studying carefully the programs to be
developed, estimate the computer time in minutes required by the experts for the application
programs as follows:

Programs
Programmers

1 (Estimated
120 100time in80
minute)
2 80 90 110
A B
3 110 C
140 120

Assign the programmers to the programs in such a way that the total computer time is minimum.

Question #4
National Mixer Inc. sells can openers. Monthly sales for a seven-month period were as follows:
Forecast September sales volume using each of the following:

Month Sales (1000)

Feb 19

Mar 18

Apr 15

May 20

Jun 18

Jul 22
 Aug 20

a) A five-month moving average

b) Exponential smoothing with a smoothing constant equal to .20,assuming a March forecast of
19
c) A weighted average using .60 for August, .30 for July, and .10 for June

Question #5
A company owns two flourmills (A and B) which have different production capacities for HIGH,
MEDIUM and LOW grade flour. This company has entered contract supply flour to a firm every
week with 12, 8, and 24 quintals of HIGH, MEDIUM and LOW grade respectively. It costs the
Co. $1000 and $800 per day to run mill A and mill B respectively. On a day, mill A produces 6,
2, and 4 quintals of HIGH, MEDIUM and LOW grade flour respectively. Mill B produces 2, 2
and 12 quintals of HIGH, MEDIUM and LOW grade flour respectively. How many days per
week should each mill be operated in order to meet the contract order most economically. Solve
the problem graphically.

i. Formulate a LPP.
ii. Change the LPP in to its standard form.
iii. Solve the LPP by using Graphical method