OUESTION 1. Discuss the methodology of Operations Research.

Explain in brief the phases of

Operations Research.
Ans:
Operations Research means the use of scientific methods to provide criteria for decisions regarding man,
machine, and systems involving repetitive operations and with application of scientific methods, techniques
and tools to the operation of a system is to get optimum solutions to the problems.
Operations Research Methodology
Operations Research methodology consists of five steps.
a) Defining the problem
The first and the most important step in the Operations Research approach of problem solving is to define
the problem. One needs to ensure that the problem is identified properly because this problem statement
will indicate the following three major aspects:
Description of the goal or the objective of the study
Identification of the decision alternative to the system
Recognition of the limitations, restrictions, and requirements of the system
b) Model Constructing
Based on the problem definition, you need to identify and select the most appropriate model to represent
the system. While selecting a model, you need to ensure that the model specifies quantitative expressions
for the objective and the constraints of the problem in terms of its decision variables. A model gives a
perspective picture of the whole problem and helps in tackling it in a well-organized manner.
c) Model Solution
A solution to a model implies determination of a specific set of decision variables that would yield an
optimum solution. An optimum solution is one which maximizes or minimizes the performance of any
measure in a model subject to the conditions and constraints imposed on the model.
d) Model Validation
A model is a good representation of a system. However, the optimal solution must work towards improving
the systems performance. You can test the validity of a model by comparing its performance with some
past data available from the actual system.
e) Result Implementation
You need to apply the optimal solution obtained from the model to the system and note the improvement in
the performance of the system. You need to validate this performance check under changing conditions.
Phases of Operations Research
Judgment phase
This phase includes the following activities:
Determination of the operations
Establishment of objectives and values related to the operations
Determination of suitable measures of effectiveness
Formulation of problems relative to the objectives
Research phase
This phase utilizes the following methodologies:
Operation and data collection for a better understanding of the problems
Formulation of hypothesis and model
Observation and experimentation to test the hypothesis on the basis of additional data
Analysis of the available information and verification of the hypothesis using pre-established
measure of effectiveness
Prediction of various results and consideration of alternative methods
Action phase
This phase involves making recommendations for the decision process. The recommendations can be
made by those who identify and present the problem or by anyone who influences the operation in which
the problem has occurred.

QUESTION 2:
a. Explain the graphical method of solving Linear Programming Problem.
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b. A paper mill produces two grades of paper viz., X and Y. Because of raw material restrictions,
it cannot produce more than 400 tons of grade X paper and 300 tons of grade Y paper in a week.
There are 160 production hours in a week. It requires 0.20 and 0.40 hours to produce a ton of
grade X and Y papers. The mill earns a profit of Rs. 200 and Rs. 500 per ton of grade X and Y
paper respectively. Formulate this as a Linear Programming Problem.
ANS:

Linear programming is a mathematical technique designed to help managers in their planning

and decision making. It is usually used in an organization that is trying to make the most
effective use of its resources. Resources typically include machinery, manpower, money, time,
warehouse space and raw materials.
While obtaining the optimal solution to an LPP by the graphical method, the statement of the
following theorems of linear programming is used:
Step 1) Formulate the problem in terms of a series of mathematical equations representing
objective function and constraints of LPP.
Step 2) Plot each of the constraints equation graphically. Replace the inequality constraint
equation to form a linear equation. Plot the equations on the planar graph with each axis
representing respectable variables.
Step 3) Identify the convex polygon region relevant to the problem. The area which satisfies all
the constraints simultaneously will be the feasible region.
Step 4) Determine the vertices of the polygon and find the values of the given objective function
Z at each of these vertices. Identify the greatest and least of these values. These are
respectively the maximum and minimum value of Z.
Step 5) Identify the values of (X1, X2) which correspond to the desired extreme value of Z. This
is an optimal solution of the problem.
Objective functions and constraints :Objective functions and constraints are formulated from
information extracted from the problem statement. The managements dilemma is to optimise
the output or the objective function subject to the set of constraints. Optimisation of resources in
which both the objective function and constraints are represented in a linear form is called
Linear programming Problem.
Formulation 1) Study the given situation to find the key decisions to be made
2) Identify the variables involved and designate them by symbols X j(j=1,2....)
3) State the feasible alternatives which generally are X j 0 for all j
4) Identify the constraints in the problem and express them as linear inequalities or equations,
LHS of which are linear functions of the decision variables.
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5) Identify the objective function and express it as a linear function of the decision variables.
b) Formulation of LPP (Objective function & Constraints)
Let x1 and x2 be the numbers of units of two grades of X and Y
Since the profit for the two grades of paper X and Y are given, the objective function is to maximize the
profit
MAX (Z)=200X1+500X2
There are 2 constrains one w.r.t. to raw materials and the other w.r.t to production hours.
The complete LPP is
Max(Z)=200X1=500x2

Sunject to
X1<=400
X2<=300
0.20x1+0.40x2<=160
x1 >=0 , x2 >=0

QUESTION 3:
a. Explain how to solve the degeneracy in transportation problems.
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b. Explain the procedure of MODI method of finding solution through optimality test.
ANS:
a) Degeneracy in transportation problem
A basic solution to an m-origin, n destination transportation problem can have at the most m+n-1
positive basic variables (non-zero), otherwise the basic solution degenerates. It follows that
whenever the number of basic cells is less than m + n 1, the transportation problem is a
degenerate one.
To resolve degeneracy, you must augment the positive variables by as many zero-valued
variables as is necessary to complete the required m + n 1 basic variable. These zero-valued
variables are selected in such a manner that the resulting m + n 1 variable constitutes a basic
solution. The selected zero valued variables are designated by allocating an extremely small
positive value to each one of them. The cells containing these extremely small allocations are
then treated like any other basic cells. The s are kept in the transportation table until temporary
degeneracy is removed or until the optimum solution is attained, whichever occurs first. At that
point, we set each = 0.
b) Method of finding solution through optimality test
The MODI (modified distribution) method allows us to compute improvement indices quickly for
each unused square without drawing all of the closed paths. Because of this, it can often provide
considerable time savings over other methods for solving transportation problems. MODI
provides a new means of finding the unused route with the largest negative improvement index.
Once the largest index is identified, we are required to trace only one closed path. This path
helps determine the maximum number of units that can be shipped via the best unused route.
STEPS

Step 1 Determine the net evaluations for the non-basic variables (empty cells)
Step 2- Determine the entering variable
Step 3- Determine the leaving variable
Step 4- Repeat step 1 to 3 to till allocations are over.
Step 5- for allocating all forms of equations ui + vj = cj, set one of the dual
variable ui/vj to zero and solve for others.
Step 6 use this value to find ij = cij vj. If all ij>= 0, then it is the optimal
solution.
Step 7 if any ij<= 0 select the most negative cell and form loop. Starting point of
the loop is positive and alternative corners of the loop are negative and positive.
Examine the quantities allocated at negative places. Select the minimum, add it to
the positive places and subtract from the negative places.
Step 8 Form a new table and repeat steps 5 to 7 till ij>= 0.

QUESTION 4:
a. Explain the steps involved in Hungarian method of solving Assignment problems.
ANS:

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Hungarian method algorithm is based on the concept of opportunity cost and is more efficient in
solving assignment problems. The following steps are adopted to solve an AP using the
Hungarian method algorithm.
Step 1: Prepare row ruled matrix by selecting the minimum values for each row and subtract it
from the other elements of the row.
Step 2: Prepare column-reduced matrix by subtracting minimum value of the column from the
other values of that column.
Step 3: Assign zero row-wise if there is only one zero in the row and cross (X) or cancel other
zeros in that column.
Step 4: Assign column wise if there is only one zero in that column and cross other zeros in
that row.
Step 5: Repeat steps 3 and 4 till all zeros are either assigned or crossed. If the number of
assignments is equal to number of rows present, you have arrived at an optimal solution, if not,
proceed to step 6.
Step 6: Mark () the unassigned rows. Look for crossed zero in that row. Mark the column
containing the crossed zero. Look for assigned zero in that column. Mark the row containing
assigned zero. Repeat this process till all the makings are done.
Step 7: Draw a straight line through unmarked rows and marked column. The number of
straight line drawn will be equal to the number of assignments made.
Step 8: Examine the uncovered elements. Select the minimum.
Subtract it from the uncovered elements.
Add it at the point of intersection of lines.
Leave the rest as is.
Prepare a new table.
Step 9: Repeat steps 3 to 7 till optimum assignment is obtained.
Step 10: Repeat steps 5 to 7 till number of allocations = number of rows.

b. Find an optimal solution to an assignment problem with the following

cost matrix:
J1
M
1
M
2
M
3
M
4

J2

J3

J4

10

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ANS:
First, the minimum element in each row is subtracted from all the elements in that row.
This gives the following reduced-cost matrix.

J1
M
1
M
2
M
3
M
4

J2

J3

J4

Since both the machines M2 and M4 have a zero cost corresponding to job J1 only, a feasible
assignment using only cells with zero costs is not possible. To get additional zeros subtract the minimum
element in the fourth column from all the elements in that column. The result is shown in the table below.

J1
M
1
M
2
M
3
M
4

J2

J3

J4

Only three jobs can be assigned using the zero cells, so a feasible assignment is still not possible. In
such cases, the procedure draws a minimum number of lines through some selected rows and columns
in such a way that all the cells with zero costs are covered by these lines. The minimum number of lines
needed is equal to the maximum number of jobs that can be assigned using the zero cells.

J1
M
1
M
2
M
3
M
4

J2

J3

J4

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A feasible assignment is now possible and an optimal solution is assigned

M1 to J3
M2 to J1
M3 to J4
M4 to J2
The total cost is given by: 7 +5+ 5+ 3 = 20
An alternate optimal solution is:
M1 to J3
M2 to J4
M3 to J2
M4 to J1

QUESTION 5:
a. Explain Monte Carlo Simulation.
MONTE CARLO SIMULATION
Monte Carlo simulation is useful when same elements of a system, such as arrival of parts to a
machine, etc., exhibit a chance factor in their behavior. Experimentation on probability
distribution for these elements is done through random sampling. Following five steps are
followed in the Monte Carlo simulation:
Procedure of Monte Carlo Simulation:
1. Decide the probability distribution of important variables for the stochastic process.
2. Calculate the cumulative probability distributing for each variable in Step 1
3. Decide an interval of random numbers for each variable.
4. Generate random numbers.
5. Simulate a series of trials and determine simulated value of the actual random variables.

b. A Company produces 150 cars. But the production rate varies with the
distribution.
Production Rate 147 148
149
150
151
152
153
Probability
0.05 0.10
0.15
0.20
0.30
0.15
0.05
At present the track will hold 150 cars. Using the following random numbers determine the
average number of cars waiting for shipment in the company and average number of empty
space in the truck. Random Numbers 82, 54, 50, 96, 85, 34, 30, 02, 64, 47.
ANS:
Production Rate
Probability
Cumulative probability
RN Range
147
0.05
0.05
00 04
148
0.10
0.15
05 14
149
0.15
0.30
15-29
150
0.20
0.50
30 49
151
0.30
0.80
50 79
152
0.15
0.95
80 94
153
0.05
1.00
95 99
Simulation for 10 days using the given random numbers
Days
1

RN
82

Production Rate
152

Car Waiting
2

Space in the truck

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2
3
4
5
6
7
8
9
10

54
50
96
85
34
30
02
64
47

150
150
153
152
150
150
147
151
150

Total

3
2
1
2
8

Therefore, Avg number of cars waiting =8/10= 0.8 /day

Avg number of empty space =3/10= 0.3/day

QUESTION 6:
Q6 a. State the assumptions of game theory.
b. What are the characteristics of Markov chain?
c. What are the rules for prioritising jobs?
6a

State the assumptions of game theory.

Game theory is a branch of mathematical analysis developed to study decision making in
conflict situations. Such a situation exists when two or more decision makers who have
different objectives act on the same system or share the same resources. There are two
person and multi-person games. Game theory provides a mathematical process for selecting
an OPTIMUM STRATEGY in the face of an opponent who has a strategy of his own.
In game theory one usually makes the following assumptions:
(1) Each decision maker or player has available to him two or more well-specified choices
or sequences of choices.
(2) Every possible combination of plays available to the players leads to a well-defined
end-state (win, loss, or draw) that terminates the game.
(3) A specified payoff for each player is associated with a end-state . A ZERO-SUM game
means that the sum of payoffs to all players is zero in each end-state.
(4) Each decision maker has perfect knowledge of the game and of his opposition; that is,
he knows in full detail the rules of the game as well as the payoffs of all other players.
(5) All decision makers are rational; that is, each player, given two alternatives, will select
the one that yields him the greater payoff.

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The last two assumptions, in particular, restrict the application of game theory in real-world
conflict situations. Nonetheless, game theory has provided a means for analyzing many
problems of interest in economics, management science, and other fields.
6b

b. What are the characteristics of Markov chain?

A Markov chain, named after Andrey Markov, is a random process that undergoes
transitions from one state to another on a state space. It must possess a property that is
usually characterized as memorylessness: the probability distribution of the next state
depends only on the current state and not on the sequence of events that preceded it. This
specific kind of memorylessness is called the Markov property. The term Markov chain
refers to the sequence of random variables such a process moves through, with the Markov
property defining serial dependence only between adjacent periods. It can thus be used for
describing systems that follow a chain of linked events, where what happens next depends
only on the current state of the system.
Thus, a Markov chain is a process that consists of a finite number of states and some
known probabilities pij, where pij is the probability of moving from state j to state i. The
changes of state of the system are called transitions. The probabilities associated with
various state changes are called transition probabilities. The process is characterized by a
state space, a transition matrix describing the probabilities of particular transitions, and an
initial state across the state space. By convention, we assume all possible states and
transitions have been included in the definition of the process, so there is always a next
state, and the process does not terminate.
A Markov chain, studied at the discrete time points 0;1;2;:::, is characterized by a set of
States S and the transition probabilities pij between the states. Here, pij is the probability
that the Markov chain is at the next time point in state j , given that it is at the present time
point at state i. The matrix P with elements pij is called the transition probability matrix of
the Markov chain. The definition of the pij implies that the row sums of P are equal to 1.
Under the conditions that all states of the Markov chain communicate with each other (i.e.,
it is possible to go from each state, possibly in more than one step, to every other state), the
Markov chain is not periodic (a periodic Markov chain is a chain in which, e.g., you can
only return to a state in an even number of steps), the Markov chain does not drift away to
infinity, the probability pi(n) that the system is in state i at time point n converges to a limit
I as n tends to infinity. These limiting probabilities, or equilibrium probabilities, can be
computed from a set of so-called balance equations. The balance equations balance the
probability of leaving and entering a state in equilibrium.
Characteristics of Markov Chain
There must be a finite number of states that are numbered 1,2,3,4.n. A finite
Markov chain is a process that moves along with the elements of a finite set.
States are required to be collectively exhaustive and mutually exclusive.
Collectively exhaustive is one in which all the possible states of the system or
process can be listed, whereas mutually exhaustive means that at any point of time,
the system can be only in one state.
The future state from the previous state can e predicted easily. Given the state
probabilities and transition probabilities, future state can be predicted.
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6c

Irreducible Chain: Irreducible is the property that regardless of the current state, we
can reach any other state in finite time. A Markov chain is said to be irreducible if
its state space is a single communicating class; in other words, if it is possible to get
to any state from any state.
Aperiodic Chain: An irreducible Markov chain only needs one aperiodic state to
imply all states are aperiodic.
Stationary Distribution
o Markov Chain can gradually forget its initial state
o eventually converge to a unique stationary distribution
A state i is said to be ergodic if it is aperiodic and positive recurrent. In other words,
a state i is ergodic if it is recurrent, has a period of 1 and it has finite mean
recurrence time. If all states in an irreducible Markov chain are ergodic, then the
chain is said to be ergodic. Ergodic average is given as:

c. What are the rules for prioritising jobs?

Many jobs in industry and elsewhere require completing a collection of tasks while
satisfying temporal and resource constraints. Temporal constraints say that some tasks have
to be finished before others can be started; resource constraints say that two tasks requiring
the same resource cannot be done simultaneously (e.g., the same machine cannot do two
tasks at once). The objective is to create a schedule specifying when each task is to begin
and what resources it will use that satisfies all the constraints while taking as little overall
time as possible. This is the job-shop scheduling problem.
Job-shop scheduling is usually done using heuristic algorithms that take advantage of
special properties of each specific instance.One way to generate schedules in job shops is
by using priority sequencing rules, which allows the schedule for a workstation to evolve
over a period of time. The decision about which job to process next is made with simple
priority rules whenever the workstation becomes available for further processing. One
advantage of this method is that last-minute information on operating conditions can be
incorporated into the schedule as it evolves.
The first-come, first-served (FCFS) rule gives the job arriving at the workstation
first the highest priority. This is most applicable when there is ample time available
for the processor and the queue length is small.
The earliest due date (EDD) rule gives the job with the earliest due date based on
assigned due dates the highest priority.
Critical Ratio: The critical ratio (CR) is calculated by dividing the time remaining
until a jobs due date by the total shop time remaining for the job, which is defined
as the setup, processing, move, and expected waiting times of all remaining
operations, including the operation being scheduled. The difference between the due
date and todays date must be in the same time units as the total shop time
remaining. A ratio less than 1.0 implies that the job is behind schedule, and a ratio
greater than 1.0 implies that the job is ahead of schedule. The job with the lowest
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CR is scheduled next.
Shortest Processing Time(SPT): The job requiring the shortest processing time at
the workstation is processed next. This rule tends to reduce both work-in-process
inventory, the average job completion (flow) time, and average job lateness.
Longest time first(LPT): Under this priority, the job which is going to take the
longest time is processed first. The smaller jobs are taken later so that more time is
consumed on solving the longest and most difficult job.
Slack Time Remaining(STR): Slack is the difference between the time remaining
until a jobs due date and the total shop time remaining, including that of the
operation being scheduled. STR = Time until job is due - (Sum of processing time
remaining). Take the job with the smallest amount of slack time.
Slack Time Remaining per Remaining Operations: A jobs priority is determined by
dividing the slack by the number of operations that remain, including the one being
scheduled, to arrive at the slack per remaining operations (S/RO). The job with the
lowest S/RO is scheduled next. Ties are broken in a variety of ways if two or more
jobs have the same priority. One way is to arbitrarily choose one of the tied jobs for
processing next.
R (Random) Pick any Job in Queue with equal probability. This rule is often used
as benchmark for other rules

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