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UNIVERSITI
TEKNOLOGI
P ETRONAS

COURSE GAB4O13 - OPERATIONS MANAGEMENT

DATE 22nd MAY 2O1O (SATURDAY)
TIME 14.30 PM - 17.30 PM (3 hours)

INSTRUCTIONS TO CANDIDATES

1. Answer ALL questions from the Question Booklet.

2. Begin EACH answer on a new page in the Answer Booklet.
3. lndicate clearly answers that are cancelled, if any.
4. Where applicable, show clearly steps taken in arriving at the solutions and
indicate ALL assumptions.
5. Do not open this Question Booklet until instructed.

Note : There are ELEVEN (11) pages in this euestion Booklet

including the cover page and appendix.
ii. Graph papers will be provided.

Universiti Teknologi pETRoNAs

 GAB 4013

The time-series model and the causal model are commonly

used in quantitative forecasting approaches. Using appropriate
examples, demonstrate the use of each model in forecasting
demand for consumer products.

[4 marks]

HomeNeeds Sdn. Bhd. supplies refrigerators to the local

community. Sales of refrigerators over a 10-month period is
shown in TABLE Qlb.

TABLE Q1 b
Month Actual Demand
(Units)
January 20
February 21

March 28
April 37
May 25
June 29
July 36
August 22
September 25
October 28

Using exponential smoothing with a = 0.5 and the

forecast for January is 20 units, determine the forecasts
from February through to October.
I
+t-( --v" [5 marks]

Calculate the mean absolute deviation (MAD). How is the

MAD used when comparing forecast obtained for 2

different values of smoothing constant?

[6 marks]

2
 GAB 4013

HomeNeeds Sdn. Bhd. also wants to forecast the demand for air
itioners. Actual demand data collected from sales seems to
an increasing trend as shown in TABLE Q1c.

TABLE Qlc
Month Actual Demand
(Units)
August 19 Lo
September 23
October 27

lf the forecast and trend for August was 20 units and 3 units
respectively, and smoothing constants, G = 0.2 and f = 0.4,
calculate the smoothed forecast including smoothed trend for
the months of October and November.
[5 marks]

Fr =), I

1r'-4'

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1t'il
3
 GAB 401 3

2
e Explain the components of a linear progrimming (Lp) problem.
\.. Describe wl/o (2) examples on industrial applications of Lp.

' t4 marksl

b. consider the following LP problem of maximizing profit for

products P and Q. Unit profit for products P and e are RM7 and
RM5 respectively.

Objective function: Maximize 7P + 5Q

Subject to: 4P + 3q <240

2P+Q<100

Sketch the graph and indicate the feasible region.

[4 marks]

Calculate the maximum profit that could be obtained from

the products P and Q.

[2 marks]

4
 l.- -( llbb
,, | 6ru GAB 4013

c. A company manufactures two models of bathtubs, model A and

model B. Both models require blending of a certain amount of
steel and zinc. 25000 kg of stJel and 6000 kg of zinc are
available for this purpose. Each model A requires a mixture of
125 kg of steel and 20 kg of zinc, and yields a profit of RMg0.
Each model B requires a mixture of 100 kg of steel and 30 kg of
Sl.e( +1'nr t zinc, and yields a profit of RM70. t." ! I r >,g *,10.
loo\ + |'g .(tlo-
i
I'
lz,t
tt-\ a,? i. Determine the LP problem formulations.
-+ --
I r-s [5 marks]
1l'-
I
\
ii. Using the LP graphical method, determine the best
)J 6vo production mix of bathtubs.

lz!- {1 t ":
[5 marks]
 e^4 bv 0- t $^*Stt
GAB 4013

3. AzmiAuto sdn. Bhd. uses 10,000 imported gear assembries each year
(250 working days) in its assembly line. The cost to place and receive
each order is RM50.00 and the demand is constant.

u;^ Using the basic Economic Order Quantity (EOO) Model,

;-
| -. ,{/
,U determine the economic order quantity and calculate the totar
I tl inventory costs. Annual holding cost is RM2.00 per unit.
t/1" i I
/a
[4 marks]

b. The company is considering making the gear assemblies in-

plant so that dependency on overseas suppliers can be
reduced. The production process is capable of making 60 units
per day. Using the Production Order Quantity Model, determine
the optimum production quantity and the total inventory costs.

[6 marks]

c. The company has received a discount schedule from a supplier

as shown in TABLE Q3c. Using Quantity Discount Model,
determine the best order quantity and the corresponding total
costs. Annual holding cost is 20 percent of the unit price.

TABLE Q3c
Unit Price
Irr lIl- t ,,
No. Discount Quantity
RM
,' l'- '
) c
1 O to 749 10.00
2 750 to 799 9.50 -1 \e

3 800 and over 8.90 '\

-t-t
,,.
L-

[10 marks]

7"/J)
/ (j

6
 GAB 4013

4. Maju sdn. Bhd. is a manufacturing company that produces precision

components. Twelve samples, each containing five parts, were taken
from a process that produces steel rods. The length of each rod in the
samples was determined. The sample means and ranges were
determined and recorded as shown in TABLE e4.
Ll ._.
A_ ,

TABLE Q4
Sample Sample Mean (in) Range (in)
1 ,/10.002 0.011 / v 0 0\1r
2 ,/ 10.002 0.014 /, +
3 / 9.991 a.007/ ,,1,
4 ,/10.006 0.022 / .l'
5 /g.ggt 0.013"/ i
6 ,/g.ggg 0.012 ,/ n
7 ,/10.001 0.009 ,/-',L
B ,/10.005 0.013,/ tf
I ,/ Lg95 0.004 ,/ l,
10 10.001 0.011 '1.
11 10.001 0.0',14 r.
12 10.006 0.009 .r
/1 c-oo6 - Q 0.l3B--,1
upper and lower control limits for the control

[6 marks]

b( te overall means for the control chart.

[4 marks]

Draw the control chart.

t\\

[6 marks]

q\\- \ What can you deduce about the process from the control
{ ,{ chart? Justify your answer.

J
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I
[4 marks]

/t/
,/2
2

7
 GAB 4013

5. a Power Tools Sdn. Bhd. uses soldering equipment in its

production line. The temperature controller of the soldering
equipment has four in-series sensitive integrated circuits
controlling the temperature. The four integrated circuits have
re I i a b i I ity va I ue s gl l?.90, 0,-99. 9 €l a!l! -%
-9.
9 1 respective ty.

b_.t&r[l--L^l:.
It was -^,-.^*
that the
discovered resulting overall reliabirity of the
soldering equipment is inadequate to meet the production line
requirements. To improve the reliability of the soldering
equipment, the supplier has recommended that a redundancy
circuit with reliability of 0.90 be installed to each of the existing
circuits. Determine the reliability of the soldering equipment if
the recommendation is adopted.

[6 marks]

b Three units of the improved soldering equipment are going to be

used in a parallel configuration at the company's production line.
Evaluate whether the parallel configuration of the improved
soldering equlpllgltt is able to meet the reliability requirement of
not less than 0.98.

[5 marks]

B
 GAB 4013

c Power Tools sdn. Bhd. employs in-house maintenance staff to

undertake maintenance of the soldering equipment but is
considering to contract out the maintenance work to the supplier
of the soldering equipment. The contract service will cost power
Tools Sdn. Bhd. RM500 per month.

The supplier has guaranteed that not more than one breakdown
would occur per month should Power Tools Sdn. Bhd. agree to
the maintenance contract. The breakdown data of the soldering
equipments for the last twelve months are as shown in
TABLE QSc. Each breakdown would cost Power Tools Sdn.
Bhd. RM1000.

Evaluate the cost advantage or disadvantage to Power Tools

Sdn. Bhd. when the maintenance service is contracted to the
supplier.

[9 marks]

TABLE Q5c

No of Number of Months That

Breakdowns Breakdowns Occurred

0 2

1 4
2 4
3 2

END OF PAPER -