BUSI2301 Introduction to Operations Management Fall 2021 Individual Assignment 1. Consider the total production (and sales) of ice cream in Canada (in millions of liters) for the period 1995 until 2007 (from left to right): 341, 331, 317, 315, 321, 278, 298, 311, 302, 302, 335, 320, 285 Fit a model to ice cream production data using each of the following techniques and forecast the 2008 production in each case. Also, plot the two moving average forecasts and the actual, the two exponential smoothing forecasts and the actual, and the linear trend and the actual (three graphs altogether). a. Two-year moving average. b. Four-year moving average. c. Exponential smoothing with smoothing constant = 0.2. d. Exponential smoothing with smoothing constant = 0.4. e. Linear trend (regression). f. Just by observing the plots, which of the above techniques would you use to forecast the ice cream production and why? (Hint: The plot overall closest to actual demand will be most accurate). g. Alternatively, compute the MAD for each forecasting technique and determine the most accurate technique. Individual Assignment: BUSI2301 2 | P a g e 2. The number of Toyota Corollas produced in the Cambridge, Ontario, plant during each month of January 2008 to December 2009 period was as follows: Assume that the cars are sold in the same month they are produced. Identify an appropriate forecasting technique, briefly state the reason(s) you chose it, and forecast Corolla demand in January 2010. 3. Fleet managers have a large pool of cars and trucks to maintain.13 One approach to the vehicle maintenance is to use periodic oil analysis: the oil from the engine and transmission are subjected periodically to a test. These tests can sometimes signal an impending failure (for example, iron particles in the oil), and preventive maintenance is then performed (at a relatively low cost), eliminating the risk of failure (failure would result in a relatively high cost). However, oil analysis costs money and it is not perfect—it can indicate that a unit is defective when in fact it is not, and it can indicate that a unit is nondefective when in fact it is. As a possible substitute for oil analysis, the company could simply change the oil periodically, thereby reducing the probability of failure. The fleet manager for the Southern Company, an electrical utility based in Atlanta (parent of Georgia Power and Light), has four alternatives: (1) do nothing, (2) use oil analysis only, (3) replace oil only, or (4) replace oil and do oil analysis. For option (1) the probability of failure is 0.1, and the cost of failure is $1,200. For option (2), the probability of failure remains at 0.1. If the unit is about to fail, the oil analysis will indicate this with probability 0.7; if the unit is not about to fail, the oil Individual Assignment: BUSI2301 3 | P a g e analysis will indicate thi ...

1. BUSI2301
Introduction to Operations Management
Fall 2021
Individual Assignment
1. Consider the total production (and sales) of ice cream in
Canada (in millions of liters)
for the period 1995 until 2007 (from left to right):
341, 331, 317, 315, 321, 278, 298, 311, 302, 302, 335, 320, 285
Fit a model to ice cream production data using each of the
following techniques and
forecast the 2008 production in each case. Also, plot the two
moving average
forecasts and the actual, the two exponential smoothing
forecasts and the actual, and
the linear trend and the actual (three graphs altogether).

2. a. Two-year moving average.
b. Four-year moving average.
c. Exponential smoothing with smoothing constant = 0.2.
d. Exponential smoothing with smoothing constant = 0.4.
e. Linear trend (regression).
f. Just by observing the plots, which of the above techniques
would you use to
forecast the ice cream production and why? (Hint: The plot
overall closest to
actual demand will be most accurate).
g. Alternatively, compute the MAD for each forecasting
technique and determine
the most accurate technique.
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2. The number of Toyota Corollas produced in the Cambridge,
Ontario, plant during each
month of January 2008 to December 2009 period was as

3. follows:
Assume that the cars are sold in the same month they are
produced. Identify an
appropriate forecasting technique, briefly state the reason(s)
you chose it, and
forecast Corolla demand in January 2010.
3. Fleet managers have a large pool of cars and trucks to
maintain.13 One approach to
the vehicle maintenance is to use periodic oil analysis: the oil
from the engine and
transmission are subjected periodically to a test. These tests can
sometimes signal
an impending failure (for example, iron particles in the oil), and
preventive
maintenance is then performed (at a relatively low cost),
eliminating the risk of failure
(failure would result in a relatively high cost). However, oil
analysis costs money and
it is not perfect—it can indicate that a unit is defective when in
fact it is not, and it can
indicate that a unit is nondefective when in fact it is. As a
possible substitute for oil

4. analysis, the company could simply change the oil periodically,
thereby reducing the
probability of failure. The fleet manager for the Southern
Company, an electrical utility
based in Atlanta (parent of Georgia Power and Light), has four
alternatives: (1) do
nothing, (2) use oil analysis only, (3) replace oil only, or (4)
replace oil and do oil
analysis. For option (1) the probability of failure is 0.1, and the
cost of failure is $1,200.
For option (2), the probability of failure remains at 0.1. If the
unit is about to fail, the oil
analysis will indicate this with probability 0.7; if the unit is not
about to fail, the oil
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analysis will indicate this with probability 0.8. The oil analysis
itself costs $20, and if it
indicates that failure is about to occur, the oil will be changed
at the cost of $14.80
and preventive maintenance will be performed. The cost of
preventive maintenance

5. to restore a unit that is about to fail is $500, whereas the cost of
maintenance for a
unit that is not about to fail is $250. For options (3) and (4),
probability of failure
decreases from 0.1 to 0.04. Analyze this decision problem.
4. One of the products of Edwards Lifesciences (EL) is artificial
heart valves made from
the heart valves of pigs.8 Different sizes of valves are required.
However, the size of
a pig's heart valve cannot be ascertained before the heart is
purchased and opened.
Therefore, EL has a mismatch problem: shortages of some sizes
and excess of
others. A program was established to document the size
distribution of valves supplied
by each supplier, and purchases were made from those suppliers
with the needed
sizes. Linear programming was used to determine the set of the
suppliers that
collectively satisfied EL's demand. Suppose EL purchases pig
valves from three
suppliers. The cost and size mix of the valves purchased from
each supplier are given

6. in the table below. Each month EL places one order with each
supplier. Suppose next
month, 250 large, 300 medium, and 100 small valves are
needed. Formulate an LP
that can be used to minimize the cost of acquiring the needed
valves and use Excel's
Solver to solve it.
5. A manager is attempting to put together an aggregate
production plan for the coming
nine months. She has obtained forecasts of aggregate demand
for the planning
horizon. The plan must deal with highly seasonal demand;
demand is relatively high
in months 3 and 4, and again in month 8, as can be seen below:
Month 1 2 3 4 5 6 7 8 9 Total
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Forecast 190 230 260 280 210 170 160 260 180 1940

7. The company has 20 permanent employees, each of whom can
produce 10 units of
output per month at a cost of $6 per unit. Inventory holding cost
is $5 per unit per month,
and back-order cost is $10 per unit per month. The manager is
considering a plan that
would involve hiring two people to start working in month 1,
one on a temporary basis
who would work until the end of month 5. The hiring of these
two would cost $500.
Beginning inventory is 0.
Start with 20 permanent workers. Prepare a minimum cost plan
that may use some
combination of hiring ($250 per worker), subcontracting ($8 per
unit, maximum of 20 units
per month, must use for at least three consecutive months), and
overtime ($9 per unit,
maximum of 25 units per month). The ending inventory in
month 9 should be zero with no
back orders at the end.
Compute the comprehensive cost analysis. (Hint: Use max.
overtime and subcontracting

8. in months 2–4.)
6. A manufacturer of exercise equipment purchases pulleys from
a supplier who lists
these prices: less than 1,000, $5 each; 1,000 to 3,999, $4.95
each; 4,000 to 5,999,
$4.90 each; and 6,000 or more, $4.85 each. Ordering cost is $50
per order, annual
holding cost is 20 percent of purchase cost, and annual usage is
4,900 pulleys.
Determine the order quantity that will minimize total cost.
7. MT makes small camping and snowmobile trailers. The
demand for camping trailers
occurs between January and June (mostly in April and May).
MT makes camping
trailers from January to June, shuts down in July and then
makes snowmobile trailers
from August to November. Suppose now is the end of
December. For simplicity, we
consider every two months as a period. The forecasts for
camping trailers during each
of the next three periods (six months) are:

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MT employs 40 permanent workers who are paid an average of
$20 per hour
(including fringe benefits) and work approximately 320 hours a
period (2 months).
They make approximately 1,000 camping trailers per period
during regular time. They
can also work up to 50 percent more as overtime (i.e., up to 12
hours a day vs. the
regular 8 hours a day) and will be paid 1.5 times the regular
wage rate. Alternatively,
MT can hire up to 40 additional temporary workers to work
during a second shift.
Hiring cost is $3,000 per temporary worker. Assume temporary
workers' wage rate
and productivity are the same as permanent workers. Also
assume that temporary
workers work only during regular time (no overtime) and are
kept for whole periods

10. (i.e., for 2 months or 4 months). Inventory holding cost per
camping trailer per period
is $180 and is charged to average inventory level during each
period. Currently there
are no camping trailers on hand, and the desired inventory at the
end of period 3 is
zero (although a small positive number is also acceptabl e). MT
wishes to meet the
total demand, but shortage during a period (except last) is
acceptable, in which case
the shortage is assumed to be backordered at the cost of $600
per camping trailer
per period.
a. Calculate all the relevant unit costs.
b. Suppose MT uses permanent workers during regular time and
overtime.
Determine the minimum cost plan in this case. Hint: Use
overtime in each
period.
c. Suppose MT hires temporary workers but decides not to use
permanent
workers during overtime (just regular time). Determine the
minimum cost plan

11. in this case. Hint: Hire 15 temps for two periods and 9 temps
for 1 period
starting in period 2.
d. Would overtime production by permanent workers and
regular time production
by temporary workers simultaneously result in a lower total
cost? Do a trade-
off analysis. What is the overall minimum cost plan?
8. Information concerning the product structure, lead times, and
quantities on hand for
an electric golf cart is shown in the following table. Use this
information to do each of
the following:
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a. Draw the product structure tree.
b. Draw the assembly time chart.
c. Develop the material requirements plan that will provide 200
golf carts at the

12. start of week 8, assuming lot-for-lot ordering.
Note:
➢ Please write all the group members’ name and student number
on the cover page.
➢ Please submit a soft-copy of your report before final exam of
this course.
➢ Please make sure your submitted assignments are neat,
readable, and well-organized.
Assignment marks will be adjusted for sloppiness, poor
grammar and spelling, as well as for
technical errors.
➢ Please all group members read, sign, and submit the
Academic Integrity.