Problem Set Quanti

PROBLEM SET: QUANTITATIVE MANAGEMENT SUBMIT ON OR BEFORE 5PM DECEMBER 6, 2019.
GENERAL INSTRUCTION: SOLVE AS NEATLY AS POSSIBLE. SHOW ALL NECESSARY COMPUTATIONS.

1. The manager of a 24-hr convenience store wants to provides a better service for customers arriving at different rates during the day.
There are 4 cashiers available to serve the customers, if not needed they can be assigned to other responsibilities (such as inventory,
accounting, simulating). It is important to provide a quick service to maintain good customer relations, the manager feels that on the
average the customer should not wait for more than five minutes before being served by the cashier. Customers arrives on a first-come,
first-served basis and the arrival pattern for a typical day is as follows:
TIME ARRIVAL RATE
9 A.M.–3 P.M. 6 patients/hour
3 P.M.–8 P.M. 4 patients/hour
8 P.M.–midnight 12 patients/hour
Arrivals follow a Poisson distribution, and service times, 12 minutes on the average, follow the exponential pattern. How many cashiers
should be on duty during each period to maintain the level of customer satisfaction?
2. A computer shop has 5 printers, which are virtually always on used by students within the university belt. Two technicians are on duty
in each of the three 8-hour shifts. About every 2 hours (following a Poisson distribution), one of the customer requires a technician’s
attention. The technician will then spend an average of 30 minutes (exponentially distributed). What is the average number of customers
being attended by the technicians? What is the average time that a customer spends waiting for one of the technician to arrive?
3. Personalized mugs turned out to be popular. The complete demand data for the years 1, 2 and 3 are given below. Compute the forecast
for each of quarters in year 4, given the forecast for the total demand in year 4 is 2980 pieces.
Quarterly Demand (in gallons)
Year Quarter 1 Quarter 2 Quarter 3 Quarter 4
1 350 710 950 420
2 370 680 1060 500
3 450 750 1020 570
4. In order to plan for the production of the sports magazine, there is a need to know the demand for a product. The following table
presents demand over the past 11 quarters. Determine the forecast for each quarter until quarter 12 using the specified forecast method.
Quarter 1 2 3 4 5 6 7 8 9 10 11 12
Demand 546 528 530 508 647 594 665 630 736 724 813
Naïve Forecast
3-quarter simple moving
forecast
Weighting the 2 quarters
with a weight of 3 for the
last quarter and one for
the quarter prior
Exponential smoothing
with α=0.25 (use the
actual values)
Exponential smoothing
with trend having α=0.55
and γ=0.75 (use the
actual values)
Note: Show sample computation for quarter 12
***Using the data from quarters 5-8, compare the MFE, MAD, MAPE, MSE and TS for each forecast approach used and interpret your
results. Tabulate your data. Show sample computation using the simple moving average forecast.
5. The New Era Toy Co. Inc., manufactures children’s wooden toys. The company believes that the current trend toward sturdier and
simpler toys will continue; thus New era must decide among three alternative methods of providing for anticipated higher demand for its
products. These are completely overhauling the existing plant and adding more machines or buying a competitor’s plant, which is
available. A fourth alternative would be to limit production to the current plant capacity (do nothing). Below is the New Era’s decision table.
Overhaul Expand Buy Do nothing
High P30,000 P60,000 P50,000 P3,000
Moderate 10,000 20,000 15,000 2,000
Low -5,000 -10,000 -20,000 -1,000
Failure -50,000 -70,000 -60,000 -5,000
New Era management has no information on how demand will be likely to shape up. Determine the best choice for New Era under these
conditions using
a)Maximin b)Maximax c)Minimax regret d)Criterion of realism ( = 0.8)
e)Laplace Criteria f.)If the percentage for the outcome to be high is 26%, moderate is 47%, low is 15% and the rest is for failure.
g.)Draw the tree diagram employing conditions (f).

Problem Set Quanti

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PROBLEM SET: QUANTITATIVE MANAGEMENT SUBMIT ON OR BEFORE 5PM DECEMBER 6, 2019.

GENERAL INSTRUCTION: SOLVE AS NEATLY AS POSSIBLE. SHOW ALL NECESSARY COMPUTATIONS.

High P30,000 P60,000 P50,000 P3,000

Moderate 10,000 20,000 15,000 2,000

Low -5,000 -10,000 -20,000 -1,000

Failure -50,000 -70,000 -60,000 -5,000

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