SHANTI BUSINESS SCHOOL

PGDM TRIMESTER- III END TERM EXAMINATION

JULY - 2015
OPERATION RESEARCH (OR)
TIME: 3 HRS.
Max. Marks: 100
Instructions:
1. The answers to Part A (MCQ) questions are to be written only in OMR sheet provided to you.
2. Only 30 minutes will be given to answer the MCQ. After that it will be collected . Use only
blue/black pen to darken the circle of OMR sheet.
3. Answers should be written neatly, briefly and to the point.
4. Main and sub question numbers should be clearly specified in the answer book.
5. Answer to sub questions of main question should be written in continuous sequence.

PART A
Total Marks: 25
1. An LPP deals with problems involving only _________.
a) Single objective
b) Multiple objective
c) Two objective
d) None of these
2. Unbounded solution in an LPP is ___________.
a) Where the objective function can be decreased indefinitely
b) Which maximizes the objective function
c) Where the objective function can be increased or decreased indefinitely
d) Where the objective function can be increased indefinitely
3. Transportation problem is a special class of __________.
a) LPP
b) Assignment problem
c) None of the two
d) Both 1 and 2
4. In Transportation problem the preferred method of obtaining either Initial feasible Solution is
_____________.
a) North west corner rule
b) Least cost method
c) Vogel’s approximation method
d) Simplex method

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5. In North West corner rule the allocation is done in ________.
a) Upper left corner
b) Upper right corner
c) Middle cell in the transportation table
d) Cell with the lowest cost
6. In Least cost method the allocation is done by selecting ___________.
a) Upper left corner
b) Upper right corner
c) Middle cell in the transportation table
d) Cell with the lowest cost
7. In Transportation problem is said to be balanced if ________.
a) Total supply is not equal to total demand
b) Total supply is greater than total demand
c) Total supply is lesser than total demand
d) Total supply is equal to total demand
8. The basic feasible solution to a transportation problem is said to be optimal if it ___________.
a) Maximizes or minimizes the transportation cost
b) Maximizes the transportation cost
c) Minimizes the transportation cost
d) Has degenerate solution
9. In transportation problem the solution is said to non-degenerate solution if occupied cells is
_____.
a) Greater than m+n-1
b) Lesser than m+n-1
c) Greater than or equal to m+n-1
d) Lesser than or equal to m+n-1
10. In transportation problem the solution is said to degenerate solution if occupied cells
is____________.
a) Greater than m+n-1
b) Lesser than m+n-1
c) Greater than or equal to m+n-1
d) Lesser than or equal to m+n-1
11. In transportation problem if total supply > total demand we add _________.
a) Dummy row with cost 0
b) Dummy column with cost 0
c) Dummy row with cost 1
d) Dummy column with cost 1
12. The assignment problem is said to be balanced if it is __________.
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 a) Square matrix
b) Rectangular matrix
c) Unit matrix
d) Triangular matrix
13. Allocation model involves the assignment of a number of jobs to the same number of men is
called______________.
a) Transportation problem.
b) Assignment problem.
c) Decision theory.
d) Simulation.
14. The purpose of dummy row or column in an assignment problem is to _________.
a) Obtain balance between total activities and total resources
b) Prevent a solution from becoming degenerate
c) Provide a means of representing a dummy problem
d) Any one of the above
15. Which of the following is a method is used to verify the optimality of the current solution of the
transportation problem__________.
a) Least cost method
b) Vogel’s method
c) North west corner rule
d) Modi method
16. Graphical method can be used only when the decision variables is___________.
a) More than 3
b) More than1
c) Two
d) One
17. In Maximization case in transportation problem we convert into minimization by subtracting all
the elements from the _________.
a) Zero
b) One.
c) Highest element
d) Lowest element
18. If an artificial variable is present in the basic variable column of optimal simplex table, then the
solution is
a) Infeasible
b) Unbounded
c) Degenerate
d) Non of the above
19. If for a given solution a slack variable is equal to zero then
a) The solution is optimal
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 b) The solution is infeasible
c) The entire amount of resource with the constraint in which the slack variable has been
appeared has been consumed
d) All of the above
20. The role of artificial variables in the simplex method is
a) To aid in finding an initial solution
b) To find optimal dual prices in the final simplex tableau
c) To start the phases of the simplex method
d) All of the above
21. For a maximization problem, the objective function coefficient for an artificial variable is
a) M
b) -M
c) Zero
d) Non of the above
22. The dual of the primal maximization LP Problem having m constraints and n non-negative
variables should
a) Have n constraints m non-negative variables
b) Be a minimization LP Problem
c) Both a and b
d) Non of the Above
23. Customer behavior in which the customer moves from one queue to another in a multiple channel
situation is
a) Balking
b) Jockeying
c) Reneging
d) Alternating
24. An advantage of simulation as opposed to optimization is that
a) Several options of measure of performance can be examined
b) Complex real-life problems can be studied
c) It is applicable in cases where there is an element of randomness in a system
d) All of the above
25. The 0-1 integer programming problem
a) Requires the decision variables to have values between zero and one
b) Requires that all the constraints have coefficient between zero and one
c) Requires that he decision variables have coefficients between zero and one
d) All of the above
PART B
Answer (ANY FIVE) questions in detail Total Marks: [5x8=40]

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1. What is Operations Research? Discuss the growing importance of Operations research in business
decisions making with examples.

2. The Marketing Department of ABC Advertising limited has collected information on the problem
of advertising for its products. This relates to the advertising media available, the number of
families expected to be reached with each alternative, cost per advertisement, the maximum
availability of each medium and the expected exposure of each one (measured as the relative value
of one advertisement in each of the media). Draft this as a linear programming problem. The
information is as given here:

Cost Maximum Expected

No. of Families
Advertising Media per Ad Availability Exposure
expected to cover
(Rs.) (No. of times) (Units)
TV (30 sec) 3,000 8,000 8 80
Radio (15 sec) 7,000 3,000 30 20
Sunday edition of a daily (1/4 page) 5,000 4,000 4 50
Magazine (1 Page) 2,000 3,000 2 60

Other information and requirements:

a) The advertising budget is Rs. 70,000.
b) The company’s objective is to maximize the expected exposure.
c) At least 40,000 families should be covered. (The families receiving messages could be
common. But a family receiving three messages, for example, would be taken to be equivalent
to three.)
d) At least 2 insertions are given in Sunday edition of a daily but not more than 4 ads should be
given on the TV.

3. A salesman has to visit five cities A, B, C, D, and E. The distances (in hundred km) between the
five cities are as follows:

A B C D E
A - 17 16 18 14
B 17 - 18 15 16
C 16 18 - 19 17
D 18 15 19 - 18
E 14 16 17 18 -

If the salesman starts from city A and has to come back to city A, which route should he select so
that the total distance travelled by him is minimum?

4. XYZ Company manufactures 30 units per day. The sale of these items depends upon demand
which has the following distribution:

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 Sales (Units) 27 28 29 30 31 32
Probability 0.10 0.15 0.20 0.35 0.15 0.05

The production cost and sale price of each unit are Rs. 40 and Rs. 50 respectively. Any unsold
product is to be disposed off at a loss of Rs. 15 per unit. There is a penalty of Rs. 5 per unit if the
demand is not met. Using the following random numbers, estimate the total profit/loss for the
company for the next ten days:10,99,65,99,95,01,79,11,16,20.

5. Solve the following transportation problem for maximum profit.

Per Unit Profit (Rs.)
Market
A B C D
Warehouses X 12 18 6 25
Y 8 7 10 18
Z 14 3 11 20

Availability at Warehouses Demands in the Markets

X 200 Units A 180 Units
Y 500 Units B 320 Units
Z 300 Units C 100 Units
D 400 Units

6. You are given the information about the cost of performing different jobs by different persons. The
job person making X indicates that the individual involved cannot perform the particular job.
Using this information, state (i) the optimal assignment of jobs, and (ii) the cost of such
assignments.

Person Job
J1 J2 J3 J4 J5
P1 27 18 X 20 21
P2 31 24 21 12 17
P3 20 17 20 X 16
P4 22 28 20 16 27

PART C
Solve ANY TWO from the following: Total Marks: 35

1. Solve the following LPP with the help of simplex Method:

Maximize: Z = 2x1 + 4x2
Subject to:
2x1 + x2 ≤ 18
3x1 + 2x2 ≥ 30
x1 + 2x2 = 26
x1 , x2 ≥ 0

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2. A firm has the choice of producing four similar products P1, P2, P3 and P4 in any combination.
These products have profit rates of Rs. 70, 65, 80, 75 respectively. They all require two types of
raw materials R1 and R2 and two types of L1 and L2. The per unit requirements and availability of
the resources every week is given in the following table:

Resources Per unit requirement Availability

P1 P2 P3 P4
R1 4 4 3 7 90 kg
R2 6 3 5 4 120 kg
L1 5 2 3 3 60 hr
L2 6 5 1 2 100 hr

You are required to determine the optimal product mix with the help of simplex method for the
firm and carry out the sensitivity analysis, for changes in the objective function coefficients and
right-hand-side values of the constraints.
OR
Interpret the Following Sensitivity Report generated by Excel Solver for the following LPP.
Maximise Z = 1.5x1 + 2.5x2 + 3.0x3 + 4.5x4
Tass = 2x1 + 4x2 + 3x3 + 7x4 (assembly)
Tpol = 3x1 + 2x2 + 3x3 + 4x4 (polish)
Tpac = 2x1 + 3x2 + 2x3 + 5x4 (pack)
Tass <= 100000 (assembly)
Tpol <= 50000 (polish)
Tpac <= 60000 (pack)
Tass + Tpol + Tpac <= 210000 (total time)
Sensitivity Report

Target Cell (Max)

Cell Name Original Value Final Value
$F$6 Total Profit 58000 58000

Adjustable Cells
Cell Name Original Value Final Value
$B$2 Number 0 0
$B$3 Number 16000 16000
$B$4 Number 6000 6000
$B$5 Number 0 0

Constraints
Cell Name Cell Value Formula Status Slack
Total Not
$C$6 Assemble 82000 $C$6<=$C$7 Binding 18000
$D$6 Total Polish 50000 $D$6<=$D$7 Binding 0
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 $E$6 Total Pack 60000 $E$6<=$E$7 Binding 0

Adjustable Cells

    Final Reduced Objective Allowable Allowable

Cell Name Value Cost Coefficient Increase Decrease

$B$2 Number 0 -1.5 1.5 1.5 1E+30

$B$3 Number 16000 0 2.5 2 0.142857143

$B$4 Number 6000 0 3 0.75 0.5

$B$5 Number 0 -0.2 4.5 0.2 1E+30

Constraints

    Final Shadow Constraint Allowable Allowable

Cell Name Value Price R.H. Side Increase Decrease
Total
$C$6 Assemble 82000 0 100000 1E+30 18000

$D$6 Total Polish 50000 0.8 50000 40000 10000

$E$6 Total Pack 60000 0.3 60000 15000 26666.66667

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