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1. What do you mean by Operations Research?
Ans. Operations Research (OR) is a discipline that uses mathematical and analytical methods to help make
better decisions and solve complex problems in various fields, including business, engineering, healthcare,
logistics, and government. It involves the application of quantitative techniques, such as mathematical
modeling, statistical analysis, optimization, and simulation, to support decision-making and improve
processes.
The primary objectives of operations research include:
1. Optimization: Finding the best possible solution from a set of alternatives, considering constraints and
objectives. This can involve optimizing resource allocation, production schedules, transportation routes, or
financial investments, among other applications.
2. Decision Analysis: Providing a structured framework for decision-making under uncertainty, involving
techniques such as decision trees, risk analysis, and game theory to evaluate alternative courses of action.
3. Simulation: Using computer-based models to replicate real-world systems and processes, allowing for
experimentation and scenario analysis without the need for real-world implementation.
4. Forecasting: Predicting future trends, demand, or outcomes using statistical methods and time series
analysis to support planning and resource allocation.
5. Queueing Theory: Analyzing waiting lines and service systems to optimize queuing processes and
improve customer service.
Operations research is interdisciplinary, drawing from fields such as mathematics, economics, engineering,
and computer science to address a wide range of problems. It is applied in diverse areas, including supply
chain management, inventory control, project management, healthcare operations, finance, and marketing.
Overall, operations research aims to provide decision-makers with quantitative tools and analytical insights to
optimize processes, allocate resources efficiently, and improve overall system performance.
2. Explain the linear programming problem giving suitable examples.

Ans. A linear programming problem involves optimizing a linear objective function subject to linear equality
and inequality constraints. The goal is to maximize or minimize the objective function while satisfying the given
constraints.
For example, consider a manufacturing company that produces two products, Product A and Product B. The
company has limited resources for production, such as labor hours and raw materials. The goal is to maximize
the total profit from the production of these products, given the resource constraints.
Let's assume the following:
- Profit per unit of Product A: $10

- Profit per unit of Product B: $15
- Labor hours required for Product A: 2 hours/unit
- Labor hours required for Product B: 3 hours/unit
- Raw material required for Product A: 3 units
- Raw material required for Product B: 2 units
- The company has 100 labor hours and 120 units of raw material available.
The objective is to maximize the total profit, which can be represented as:
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01765-520048,01763502165,8727800190
Maximize Z = 10A + 15B
Subject to the constraints:

2A + 3B ≤ 100 (Labor hours constraint)
3A + 2B ≤ 120 (Raw material constraint)
A, B ≥ 0 (Non-negativity constraint)
Where A represents the units of Product A produced, and B represents the units of Product B produced.
By solving this linear programming problem, the company can determine the optimal production quantities for
Products A and B that maximize the total profit while respecting the resource limitations.
3. What do you mean by no passing rule?

Ans. The "no-passing rule" is a concept in linear programming, specifically in the context of the simplex
method.
In the simplex method, the "no-passing rule" refers to a condition that ensures the method does not enter an
infinite loop when cycling through different basic feasible solutions. The no-passing rule states that when
selecting the entering variable (the variable that will enter the basis in the next iteration), the method should
not select a variable that was the leaving variable in the previous iteration.
This rule helps to prevent the simplex method from revisiting the same set of basic feasible solutions, which
could cause it to cycle indefinitely without converging to an optimal solution. By adhering to the no-passing
rule, the simplex method ensures progress towards the optimal solution by moving from one basic feasible
solution to another without revisiting the same solution in subsequent iterations.
4. What do you mean by unbalanced assignment problem?

Ans. An unbalanced assignment problem occurs when the number of agents (or resources) does not equal
the number of tasks to be assigned. In other words, the problem is unbalanced when the number of rows in
the cost matrix is not equal to the number of columns. This situation arises in real-world scenarios where there
are more or fewer resources than tasks, leading to an uneven distribution.
For example, consider a scenario where a manager needs to assign three employees (A, B, and C) to three
different tasks (X, Y, and Z). However, due to resource constraints, the manager can only assign two
employees to the tasks. This creates an unbalanced assignment problem.
| | Task X | Task Y | Task Z |

|---------|--------|--------|--------|
| Employee A | 3 |5 |2 |
| Employee B | 2 |6 |4 |
| Employee C | 7 |3 |8 |
In this example, there are three employees and three tasks, but only two employees can be assigned to tasks.
This imbalance makes it an unbalanced assignment problem. When solving such a problem, adjustments or
additional constraints may be necessary to ensure that all tasks are completed while considering the limited
resources available.
5. What do you mean by unbalanced transportation problem?

Ans. An unbalanced transportation problem occurs when the total supply from sources does not equal the
total demand at destinations in a transportation network. In other words, the total capacity of the sources (e.g.,
factories, warehouses) does not match the total demand at the destinations (e.g., retailers, customers),
leading to an uneven distribution.

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In a balanced transportation problem, the total supply is equal to the total demand, ensuring that all goods can
be transported from sources to destinations without any excess or shortage. However, in an unbalanced
transportation problem, there is either excess supply or excess demand, which requires additional
considerations to resolve.
For example, if the total supply exceeds the total demand, it creates excess capacity at the sources, and
decisions need to be made about how to utilize the excess capacity. Conversely, if the total demand exceeds
the total supply, there is a shortage of goods at the destinations, and decisions need to be made about how to
prioritize the distribution of available goods.
When solving an unbalanced transportation problem, adjustments such as adding dummy sources or dummy
destinations, modifying the costs, or introducing additional constraints may be necessary to ensure an optimal
transportation plan while considering the imbalanced supply and demand.
6. What is a replacement problem?

Ans. A replacement problem, in the context of operations research and engineering economics, involves
making decisions about replacing or retaining an asset, typically based on factors such as its age, condition,
and potential future performance. The goal of a replacement problem is to determine the optimal time to
replace an asset, taking into account costs, benefits, and other relevant factors.
Common examples of replacement problems include:
1. Equipment Replacement: Determining the most cost-effective time to replace machinery, vehicles, or
other equipment to minimize maintenance costs, downtime, and the risk of failure.
2. Asset Replacement: Deciding when to replace aging infrastructure, such as bridges, roads, or buildings, to
ensure safety, functionality, and cost-efficiency.
3. Technology Replacement: Assessing when to upgrade or replace outdated technology, such as computer
systems, software, or communication networks, to maintain productivity and competitiveness.
In a typical replacement problem, various factors are considered, including the initial cost of the asset, ongoing
maintenance and operating costs, the expected performance and reliability over time, salvage value, and the
costs associated with replacing the asset. By using mathematical models, optimization techniques, and
economic analysis, decision-makers can determine the optimal replacement time that minimizes costs or
maximizes benefits over the asset's lifecycle.
The decision-making process in replacement problems often involves comparing the total costs or benefits
associated with retaining the current asset versus replacing it with a new one at different points in time. This
analysis helps organizations make informed decisions to ensure efficient resource allocation and maintain
operational effectiveness.
7. What is queue discipline?

Ans. Queue discipline, in the context of queuing theory and operations management, refers to the set of rules
or policies that govern the order in which customers or entities are served from a queue. It defines how the
items in the queue are selected for service, the order in which they are processed, and how they interact with
the service system.
Several common queue disciplines include:
1. First-Come, First-Served (FCFS): In this discipline, the customer who arrives first is served first. It follows
a "first in, first out" (FIFO) principle, where the oldest item in the queue is the next to be served.

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2. Last-Come, First-Served (LCFS): This discipline prioritizes the most recent arrivals, with the last customer
to join the queue being served first. It follows a "last in, first out" (LIFO) principle.
3. Priority Queuing: Priority queuing assigns a priority level to each customer or entity in the queue, and the
items with higher priority are served before those with lower priority. This allows for preferential treatment of
certain customers based on specific criteria.
4. Shortest Processing Time: In this discipline, the item with the shortest processing time is served first. It
aims to minimize the average waiting time for all customers in the queue.
5. Round Robin: Round robin scheduling serves each customer in turn, with a fixed time quantum allocated
to each customer. If the service is not completed within the time quantum, the customer is placed back at the
end of the queue.
Queue discipline plays a crucial role in managing customer satisfaction, resource utilization, and system
performance. The choice of queue discipline can significantly impact factors such as waiting times, fairness in
service, system throughput, and the overall efficiency of the service process. Different queue disciplines are
suitable for different applications, and selecting the appropriate discipline is an important aspect of queue
management and operations design.
8. What is critical path?

Ans. The critical path is a concept used in project management to identify the sequence of tasks that
determine the minimum amount of time required to complete a project. It represents the longest path through a
project's network diagram, and any delay in the critical path tasks will directly impact the project's overall
timeline.
Key characteristics of the critical path include:
1. Sequential Tasks: The critical path consists of a series of interdependent tasks that must be completed in
a specific order. These tasks are linked in such a way that the completion of one task triggers the start of the
next.
2. Longest Duration: The critical path represents the sequence of tasks that collectively require the greatest
amount of time to complete. As a result, any delays in these tasks will directly extend the overall project
duration.
3. Project Completion: The critical path identifies the minimum time required to complete the entire project.
Therefore, any changes or delays in the critical path tasks will impact the project's final delivery date.
Project managers use critical path analysis to identify the most time-critical tasks and allocate resources and
attention accordingly. By focusing on the critical path, project managers can prioritize activities, mitigate
potential delays, and ensure that the project stays on schedule.
Critical path analysis is often visualized through a network diagram or a Gantt chart, where the critical path is
highlighted to provide a clear overview of the most important tasks for the project's timely completion.
Additionally, the critical path method (CPM) and program evaluation and review technique (PERT) are
commonly used to analyze and manage the critical path in project planning and scheduling.
9. What do you mean by carrying cost of inventory?

Ans. The carrying cost of inventory, also known as holding cost, refers to the expenses associated with
storing and maintaining inventory over a certain period of time. It represents the cost of holding or "carrying"
inventory in a warehouse, storage facility, or any other storage location. Carrying costs are an important

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consideration in inventory management and supply chain operations, as they directly impact the overall cost
and profitability of maintaining inventory levels.
Carrying costs typically include the following components:
1. Storage Costs: This encompasses expenses related to warehouse or storage facility rental, utilities,
insurance, security, and maintenance. These costs are incurred to provide a suitable environment for storing
inventory items.
2. Capital Costs: The opportunity cost of the capital tied up in inventory is an important element of carrying
costs. This includes the cost of financing the inventory investment, such as the interest or the expected return
on investment that could have been achieved if the capital was invested elsewhere.
3. Obsolescence and Shrinkage: Carrying costs also account for potential losses due to obsolescence,
spoilage, theft, or damage to inventory items. These risks are factored into the overall cost of holding
inventory.
4. Inventory Service Costs: These costs include expenses related to handling, managing, and tracking
inventory, as well as the cost of any specialized equipment or technology required for inventory management.
5. Opportunity Cost: This refers to the potential lost opportunities that could have been pursued if the
resources tied up in inventory were available for other investments or activities.
Reducing carrying costs is a key objective in inventory management, as it directly impacts a company's
profitability and cash flow. By optimizing inventory levels, improving inventory turnover, and minimizing storage
expenses, organizations can effectively manage carrying costs and enhance their overall operational
efficiency. Balancing the costs of holding inventory with the cost of stockouts and lost sales is a critical
consideration in achieving an optimal inventory management strategy.
10. What are the essential characteristics of linear programming model?

Ans. The essential characteristics of a linear programming (LP) model include the following:
1. Linearity: The objective function and all constraints in a linear programming model are linear. This means
that the coefficients of decision variables in the objective function and constraints are all linear terms. The
relationship between the decision variables is represented as a linear equation or inequality.
2. Objective Function: Linear programming models have a well-defined objective function that is to be
maximized or minimized. The objective function is a linear combination of decision variables and represents
the goal of the optimization problem, such as maximizing profit, minimizing cost, or maximizing resource
utilization.
3. Constraints: Linear programming models are subject to a set of linear constraints that represent limitations
or restrictions on the decision variables. These constraints can include restrictions on resources, capacity,
demand, or other factors. Each constraint is represented as a linear equation or inequality.
4. Non-negativity Constraints: In linear programming, decision variables are typically required to be non-
negative, meaning they cannot take on negative values. This is a fundamental characteristic of linear
programming models, as it reflects the real-world constraints of many decision-making problems.
5. Proportionality: Linear programming models assume that the relationship between decision variables and
the objective function or constraints is proportional and consistent. This implies that changes in decision
variable values lead to proportional changes in the objective function and constraint values.

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6. Certainty: Linear programming models assume that all parameters, coefficients, and relationships are
known with certainty and do not involve uncertainty or variability. This is a simplifying assumption that allows
for precise mathematical optimization.
7. Additivity: The objective function and constraints in linear programming models are additive, meaning that
the total contribution of decision variables to the objective function and constraints is the sum of the individual
contributions.
Linear programming models are widely used in optimization problems across various fields, including
operations research, economics, engineering, and management, to find optimal solutions to resource
allocation, production planning, transportation, scheduling, and other decision-making challenges.
12. Explain the use of artificial variables in L.P. P.

Ans. In linear programming (LP), artificial variables are introduced to assist in converting an LP problem into a
standard form that can be solved using the simplex method. The simplex method requires the LP problem to
be in standard form, which means all constraints must be equations and all variables must be non-negative.
When the original LP problem has inequality constraints or variables with negative coefficients, artificial
variables are added to transform the problem into standard form. These artificial variables help in finding an
initial feasible solution, which is necessary for the simplex method to start the iterative process of finding the
optimal solution. Once the initial solution is found, the artificial variables are then removed from the final
solution.
13. What do you mean by a transportation problem?

Ans. The transportation problem is a special type of linear programming problem where the objective is to
minimise the cost of distributing a product from a number of sources or origins to a number of destinations.
Because of its special structure the usual simplex method is not suitable for solving transportation problems.
These problems require a special method of solution. The origin of a transportation problem is the location
from which shipments are despatched. The destination of a transportation problem is the location to which
shipments are transported. The unit transportation cost is the cost of transporting one unit of the consignment
from an origin to a destination.
14. What is an unbalanced assignment problem? Explain with the help of an example.
Ans. An unbalanced assignment problem occurs when the number of agents (or resources) does not equal
the number of tasks to be assigned. In other words, the problem is unbalanced when the number of rows in
the cost matrix is not equal to the number of columns. This situation arises in real-world scenarios where there
are more or fewer resources than tasks, leading to an uneven distribution.
For example, consider a scenario where a manager needs to assign three employees (A, B, and C) to three
different tasks (X, Y, and Z). However, due to resource constraints, the manager can only assign two
employees to the tasks. This creates an unbalanced assignment problem.
| | Task X | Task Y | Task Z |

|---------|--------|--------|--------|
| Employee A | 3 |5 |2 |
| Employee B | 2 |6 |4 |
| Employee C | 7 |3 |8 |
In this example, there are three employees and three tasks, but only two employees can be assigned to tasks.
This imbalance makes it an unbalanced assignment problem. When solving such a problem, adjustments or
additional constraints may be necessary to ensure that all tasks are completed while considering the limited
resources available.
15. What are the limitations of Game theory?

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Ans.1. As the number of players increases in the actual business the game theory becomes more difficult.
2. It simply provides a general rule of logic not the winning strategy.
3. There is much uncertainty in actual field of business which cannot be considered in game theory.
4. Businessmen do not have adequate knowledge for the game theory.
16. What are the situations, which makes the replacement of an item necessary?
Ans. Equipment are generally considered for replacement for the following reasons:
(i) Deterioration
(ii) Obsolescence
(iii) Inadequacy
(iv) Working Conditions
(v) Economy
(i) Technical Factors
(ii) Financial/Cost Factors
(iii) Tangible Factors
17. What is CPM?

Ans. CPM stands for Critical Path Method. It is a project management technique used to plan and manage
complex projects. CPM involves identifying the critical path, which is the sequence of tasks that determines
the shortest possible duration for the project. By analyzing the critical path, project managers can prioritize
tasks, allocate resources, and identify potential bottlenecks or delays. CPM is particularly useful for scheduling
and coordinating activities in large construction projects, engineering projects, software development, and
other endeavors with multiple interdependent tasks.
18. What is Slack?

Ans. In an optimization problem a slack variable is a variable that is added to an inequality constraint to
transform it to an equality introducing. a slack variable replaces an inequality constraint with an equality
constraint and a non-negativity constraint in linear programming.
19. What do you mean by ABC Analysis?

Ans. ABC Analysis is a method used in inventory management to categorize items based on their importance.
It classifies items into three categories: A, B, and C. Category A items are the most important and valuable,
representing a small percentage of the inventory but accounting for a large portion of the value. Category C
items are the least important and valuable, representing a large percentage of the inventory but accounting for
a small portion of the value. This analysis helps businesses prioritize resources and focus on managing critical
items more closely.
LONG ANSWER TYPE QUESTIONS
Q1 Explain the scope of operation research from the perspective of a business organization.
Ans. Operations research (OR) is an analytical method of problem-solving and decision-making that is useful
in the management of organizations. In operations research, problems are broken down into basic
components and then solved in defined steps by mathematical analysis. Analytical methods used in OR
include mathematical logic, simulation, network analysis, queuing theory, and game theory. The process can
be broadly broken down into three steps.
(i) Judgment Phase:
i. Determination of operation. ii. Determination of objectives. iii. Determination of effectiveness of measures. iv.
Determination of type of problem, its origin and causes.
(ii) Research Phase:
i. Observation and data collection for better understanding of the problem. ii. Formulation of relevant
hypothesis and models. iii. Analysis of available information and verification of hypothesis. iv. Production and
generation of results and consideration of alternatives.
(iii) Action Phase:
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i. Recommendations for remedial action to those who first posed the problem, this includes the assumptions
made,
scope and limitations, alternative courses of action and their effect. ii. Putting the solution to work:
implementation.
Scope of Operations Research
The scope of OR is not only confined to any specific agency like defence services but today it is widely used in
all industrial organisations. It can be used to find the best solution to any problem be it simple or complex. It is
useful in every field of human activities, where optimisation of resources is required in the best way. Thus, it
attempts to resolve the conflicts of interest among the components of organization in a way that is best for the
organisation as a whole. The main fields where OR is extensively used are given below, however, this list is
not exhaustive but only illustrative.
(i) National Planning and Budgeting:- OR is used for the preparation of Five Year Plans, annual
budgets, forecasting of income and expenditure, scheduling of major projects of national importance,
estimation of GNP, GDP, population, employment and generation of agriculture yields etc.
(ii) Defence Services: - Basically formulation of OR started from USA army, so it has wide application in
the areas such as: development of new technology, optimization of cost and time, tender evaluation, setting
and layouts of defence projects, assessment of “Threat analysis”, strategy of battle, effective maintenance
and replacement of equipment, inventory control, transportation and supply depots etc.
(iii) Industrial Establishment and Private Sector Units: - OR can be effectively used in plant location
and setting finance planning, product and process planning, facility planning and construction, production
planning and control, purchasing, maintenance management and personnel management etc. to name a few.
(iv) R & D and Engineering: -Research and development being the heart of technological growth, OR has
wide scope for and can be applied in technology forecasting and evaluation, technology and project
management, preparation of tender and negotiation, value engineering, work/method study and so on.
(v) Business Management and Competition: -OR can help in taking business decisions under risk and
uncertainty, capital investment and returns, business strategy formation, optimum advertisement outlay,
optimum sales force and their distribution, market survey and analysis and market research techniques etc.
(vi) Agriculture and Irrigation: -In the area of agriculture and irrigation also OR can be useful for project
management, construction of major dams at minimum cost, optimum allocation of supply and collection points
for fertilizer/seeds and agriculture outputs and optimum mix of fertilizers for better yield.
(vii) Education and Training: -OR can be used for obtaining optimum number of schools with their
locations, optimum mix of Students/teacher student ratio, optimum financial outlay and other relevant
information in training of graduates to meet out the national requirements.
(viii) Transportation: -Transportation models of OR can be applied to real life problems to forecast public
transport requirements, optimum routing, forecasting of income and expenses, project management for
railways, railway network distribution, etc. In the same way it can be useful in the field of communication.
(ix) Home Management and Budgeting: -OR can be effectively used for control of expenses to maximize
savings, time management, work study methods for all related works. Investment of surplus budget,
appropriate insurance of life and properties and estimate of depreciation and optimum premium of insurance
etc.
Q2 Explain various applications of Linear Programming Problems (LPP).

Ans. Linear programming is used to obtain optimal solutions for operations research. Using linear
programming allows researchers to find the best, most economical solution to a problem within all of its
limitations, or constraints. Many fields use linear programming techniques to make their processes more
efficient.
Applications of linear programming for solving business problems:
1. Production Management:
LP is applied for determining the optimal allocation of such resources as materials, machines, manpower, etc.
by a firm. It is used to determine the optimal product- mix of the firm to maximize its revenue. It is also used for
product smoothing and assembly line balancing.
2. Personnel Management:

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LP technique enables the personnel manager to solve problems relating to recruitment, selection, training, and
deployment of manpower to different departments of the firm. It is also used to determine the minimum
number of employees required in various shifts to meet production schedule within a time schedule.
3. Inventory Management:
A firm is faced with the problem of inventory management of raw materials and finished products. The
objective function in inventory management is to minimise inventory cost and the constraints are space and
demand for the product. LP technique is used to solve this problem.
4. Marketing Management:
LP technique enables the marketing manager in analysing the audience coverage of advertising based on the
available media, given the advertising budget as the constraint. It also helps the sales executive of a firm in
finding the shortest route for his tour. With its use, the marketing manager determines the optimal distribution
schedule for transporting the product from different warehouses to various market locations in such a manner
that the total transport cost is the minimum.
5. Financial Management:
The financial manager of a firm, mutual fund, insurance company, bank, etc. uses the LP technique for the
selection of investment portfolio of shares, bonds, etc. so as to maximise return on investment.
6. Blending Problem:
LP technique is also applicable to blending problem when a final product is produced by mixing a variety of
raw materials. The blending problems arise in animal feed, diet problems, petroleum products, chemical
products, etc. In all such cases, with raw materials and other inputs as constraints, the objective function is to
minimise the cost of final product.
Q3 Consider a modified form of Matching biased coins game problem. The matching player is paid
Rs 8.00 if the two coins turn both heads and Re. 1.00 if the coins turn both tail. The nonmatching
player is paid Rs. 3.00 when the two coins do not match. Given the choice of being the matching or
non-matching player, which one would you choose and what would be your strategy.
Ans. In the modified form of the Matching biased coins game problem, the payouts are as follows:
- Matching player: Rs 8.00 for two heads, Re. 1.00 for two tails
- Non-matching player: Rs. 3.00 for non-matching outcome
To decide which player to choose and the corresponding strategy, we can analyze the expected value for
each player.
For the matching player:

The probability of getting two heads is (1/2) * (1/2) = 1/4
The probability of getting two tails is (1/2) * (1/2) = 1/4
So, the expected value for the matching player is:
(1/4) * Rs 8.00 + (1/4) * Re. 1.00 = Rs 2.00 + Re. 0.25 = Rs 2.25
For the non-matching player:

The probability of getting a non-matching outcome is 1 - (1/4 + 1/4) = 1/2
So, the expected value for the non-matching player is:
(1/2) * Rs. 3.00 = Rs. 1.50
Based on the expected values, the non-matching player has a higher expected value (Rs. 1.50) compared to
the matching player (Rs 2.25). Therefore, if the goal is to maximize expected value, the strategy would be to
choose to be the non-matching player.
So, the strategy would be to choose the non-matching player in order to maximize the expected payout.
Q4. What do you ,mean by queuing theory?Explain various characteristic of M/M/1 model of Queuing
Theory.
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Queuing theory is a branch of operations research that focuses on the study of queues, or waiting lines, and
the mathematical modeling of systems involving waiting. It provides a framework for analyzing and
optimizing the behavior and performance of queues in various systems, such as telecommunications,
transportation, healthcare, and customer service.
The M/M/1 model is a specific type of queuing model that is characterized by the following features:
1. Arrival Process: The arrival of customers or entities into the system follows a Poisson process, which
means that the inter-arrival times between successive arrivals are exponentially distributed. This implies that
the arrival rate follows a Poisson distribution.
2. Service Time: The service time required for the server to process a customer is exponentially distributed.
This means that the service rate follows an exponential distribution.
3. Single Server: The system has a single server, meaning that only one customer can be served at a time.
Once the server is busy, arriving customers have to wait in a queue.
4. Queue Discipline: The model assumes a first-come, first-served (FCFS) queue discipline, where the
customer who arrives first is served first.
5. Infinite Queue Capacity: The model assumes an infinite queue capacity, meaning that there is no limit to
the number of customers that can wait in the queue.
6. Steady-State Behavior: The model assumes that the system has reached a steady-state, where the
arrival rate and service rate are constant and the queue length and waiting time have stabilized.
7. Performance Measures: The M/M/1 model allows for the calculation of various performance measures,
such as the average number of customers in the system, average number of customers in the queue,
average waiting time, and system utilization.
By analyzing the M/M/1 model, queuing theorists can gain insights into the behavior of single-server queues,
make predictions about system performance, and optimize various aspects of the system to improve
efficiency and customer satisfaction.
Q5. What are the situations in which techniques of operation research can be used?
Operations research techniques can be used in a wide range of situations across various industries and
domains. Some common situations where operations research techniques are applied include:
1. Supply Chain Management: Operations research is used to optimize inventory management, distribution
networks, transportation logistics, and supply chain planning to minimize costs and improve efficiency.
2. Transportation and Logistics: Operations research techniques are applied to optimize routing,
scheduling, and fleet management for transportation companies, airlines, and shipping firms.
3. Healthcare: Operations research is used to improve hospital resource allocation, staff scheduling, patient
flow management, and healthcare delivery processes to enhance patient care and reduce operational costs.
4. Manufacturing and Production: Operations research techniques are utilized to optimize production
scheduling, capacity planning, facility layout, and inventory control in manufacturing environments.
5. Finance and Investment: Operations research is applied to portfolio optimization, risk management,
trading strategies, and investment decision-making in the financial industry.
6. Marketing and Revenue Management: Operations research techniques are used to optimize pricing
strategies, revenue management, and customer segmentation in marketing and sales operations.
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7. Project Management: Operations research is applied to optimize project scheduling, resource allocation,
and project planning to improve project efficiency and minimize completion time.
8. Energy and Utilities: Operations research techniques are used to optimize energy production,
distribution, and resource allocation in the energy and utilities sector.
9. Telecommunications: Operations research is applied to optimize network design, capacity planning, and
resource allocation in telecommunications and networking.
10. Public Policy and Government: Operations research techniques are used to analyze and optimize
public policy decisions, resource allocation, transportation planning, and emergency response management.
These are just a few examples of the many areas where operations research techniques can be applied to
solve complex problems, make data-driven decisions, and optimize processes to achieve better outcomes.
Q6. Dual and Primal are two sides of same coin. Comment
The duality principle in linear programming states that every linear programming problem has a related
problem called its dual, and the two problems are closely related. The primal problem seeks to maximize an
objective function subject to linear constraints, while the dual problem seeks to minimize a related objective
function subject to its own set of constraints.
The relationship between the primal and dual problems can be likened to two sides of the same coin due to
the following reasons:
1. Corresponding Variables: In the primal and dual problems, the decision variables of one problem
correspond to the constraints of the other. The coefficients of the primal objective function become the
constraints in the dual problem, and vice versa.
2. Relationship between Optimal Solutions: The optimal solution of the primal problem provides a lower
bound for the optimal solution of the dual problem, and conversely, the optimal solution of the dual problem
provides an upper bound for the optimal solution of the primal problem. This relationship is known as weak
duality.
3. Complementary Slackness: The complementary slackness condition states that for an optimal solution
to the primal problem and an optimal solution to the dual problem, certain relationships hold between the
decision variables and the constraints, demonstrating the complementary nature of the two problems.
4. Economic Interpretation: The dual problem often has an economic interpretation related to resource
pricing, shadow prices, or the value of additional resources, while the primal problem deals with resource
allocation and decision-making.
5. Optimization and Resource Allocation: The primal problem focuses on optimizing a given objective
function, while the dual problem deals with the allocation of resources and the pricing of constraints.
Overall, the primal and dual problems are two sides of the same coin in the sense that they are intimately
connected, and the properties, solutions, and interpretations of one problem are closely related to those of
the other. The duality principle is a fundamental concept in linear programming and optimization, and it
provides valuable insights into the structure and properties of optimization problems.
Q7 What do you mean by Decision Tree Analysis? Explain its Process and Importance.
Decision tree analysis is a powerful tool used in operations research, machine learning, and data analysis to
model and analyze decision-making processes. It is a graphical representation of decision-making under
uncertainty, where decisions, chance events, and their potential outcomes are depicted in a tree-like

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structure. Decision tree analysis is widely used in various fields, including business, finance, healthcare, and
engineering, to support decision-making and risk assessment.
Process of Decision Tree Analysis:
1. Problem Definition: The first step in decision tree analysis involves defining the decision problem and
identifying the key decisions, uncertainties, and potential outcomes that need to be considered.
2. Tree Structure: A decision tree is constructed with nodes representing decision points, chance events,
and end states (outcomes). Decision nodes indicate points where a decision must be made, chance nodes
represent uncertain events, and end nodes depict the final outcomes.
3. Branching: From each decision node or chance node, branches are drawn to represent the possible
alternatives or outcomes. The branches are labeled with the decision options or the probabilities associated
with the different outcomes.
4. Evaluation of Alternatives: At each decision node, the decision-maker evaluates the available
alternatives and selects the one that maximizes expected utility or minimizes expected costs.
5. Probability Assessment: When chance events are involved, probabilities are assigned to the different
outcomes at the chance nodes based on historical data, expert judgment, or statistical analysis.
6. Outcome Evaluation: The outcomes of the decision tree are evaluated by calculating the expected
value, which is a weighted average of the outcomes based on their probabilities.
Importance of Decision Tree Analysis:
1. Decision Support: Decision trees provide a visual and structured framework for analyzing complex
decision problems and support decision-makers in evaluating different options and their potential
consequences.
2. Risk Assessment: Decision tree analysis allows for the assessment of risks and uncertainties associated
with different decision paths, helping decision-makers to make informed choices under uncertainty.
3. Resource Allocation: It helps in optimizing resource allocation by identifying the most favorable decision
paths and alternatives based on their expected values.
4. Problem Solving: Decision trees aid in problem-solving by breaking down complex decision problems
into simpler, more manageable components, making it easier to understand and analyze the decision-
making process.
5. Predictive Modeling: In machine learning and data analysis, decision trees are used for classification
and prediction tasks, where they can be trained to make decisions based on input variables and their
potential outcomes.
Q8 Arrivals of customers at a telephone booth follow poisson distribution, with an average time of 10
minutes between one arrival and the next. The length of the phone call is assumed to be distributed
exponentially with a mean of 3 minutes. Find a. The average number of persons waiting and making
telephone calls b. The average length of the queue that is formed from time to time. c. Probability that
a customer arrive and find telephone booth is busy. d. Probability that a customer arrive and find
telephone booth is empty. e. The average time spent by a customer in telephone booth
To solve this problem, we can use concepts from queuing theory. Given that arrivals follow a Poisson
distribution and the length of phone calls follows an exponential distribution, we can calculate the average
number of persons waiting and making telephone calls, the average length of the queue, the probability of
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finding the telephone booth busy or empty, and the average time spent by a customer in the telephone
booth.
a. Average number of persons waiting and making telephone calls:

The average number of persons in the system (waiting and making calls) can be calculated using the
formula for the M/M/1 queuing model, where arrivals follow a Poisson distribution and the service times
follow an exponential distribution.
The average number of persons in the system (L) is given by:

L=λ*W
where λ is the arrival rate and W is the average time a customer spends in the system.
Given:
λ (arrival rate) = 1/10 (since the average time between arrivals is 10 minutes)
W (average time a customer spends in the system) = 1/μ (where μ is the service rate, i.e., 1/mean service
time)
The service rate (μ) can be calculated as 1/mean service time = 1/3 (since the mean service time is 3
minutes).
So, W = 1 / (1/3) = 3 minutes.
Now, we can calculate the average number of persons in the system:

L = (1/10) * 3 = 0.3
b. Average length of the queue:

The average length of the queue can be calculated using Little's Law, which states that the average number
of customers in a system is equal to the average arrival rate multiplied by the average time a customer
spends in the system.
Using the same values as above:

Lq = λ * W
Lq = (1/10) * 3 = 0.3
c. Probability that a customer arrives and finds the telephone booth busy:
This is the probability that the system is in use when a customer arrives. It can be calculated using the
formula for the M/M/1 queuing model:
P_busy = λ / μ
P_busy = (1/10) / (1/3) = 1/30
d. Probability that a customer arrives and finds the telephone booth empty:
This is the probability that the system is idle when a customer arrives. It can be calculated using the formula
for the M/M/1 queuing model:
P_idle = 1 - P_busy
P_idle = 1 - 1/30 = 29/30
e. The average time spent by a customer in the telephone booth:

The average time spent by a customer in the system (W) is 3 minutes, as calculated earlier.
So, the average time spent by a customer in the telephone booth is 3 minutes.
These calculations provide insights into the behavior of the telephone booth system and help in
understanding the average number of customers, the probability of finding the telephone booth busy or
empty, and the average time a customer spends in the system.

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Q9 Model building is the essence of operation research approach. Comment.
Model building is indeed the essence of the operations research approach, and it plays a crucial role in
problem-solving and decision-making. Here are some key points to consider:
1. Abstraction of Real-World Problems: Operations research involves addressing complex real-world

problems by creating simplified, abstract models that capture the essential features of the system being
studied. These models represent the relationships and interactions among various components of the system,
allowing decision-makers to understand and analyze the problem in a structured manner.
2. Problem Formulation: Model building facilitates the formulation of problem statements by identifying the
key decision variables, constraints, and objectives. By representing the problem in a formal model, operations
researchers can define and refine the problem's scope, enabling a systematic approach to finding solutions.
3. Decision Support: Models serve as decision support tools by providing a framework for evaluating
alternative courses of action and making informed decisions. They enable decision-makers to explore "what-if"
scenarios, analyze the impact of different decisions, and assess the trade-offs involved in complex decision
problems.
4. Optimization and Simulation: Operations research models are often used for optimization and simulation.
Optimization models, such as linear programming and integer programming, help in identifying the best
possible solutions that optimize specific objectives, such as maximizing profits or minimizing costs. Simulation
models allow for the analysis of system behavior under various conditions and uncertainties.
5. Quantitative Analysis: Models enable quantitative analysis of problems by representing relationships

using mathematical equations, algorithms, and decision rules. This quantitative approach helps in rigorously
analyzing the problem, identifying patterns, and deriving insights from data.
6. Communication and Collaboration: Model building encourages collaboration among multidisciplinary

teams, as it requires input from subject matter experts, data analysts, and decision-makers. By creating a
common framework for problem analysis, models facilitate communication and shared understanding among
stakeholders.
7. Continuous Improvement: Operations research models are dynamic and can be refined based on new
data, changing conditions, and evolving requirements. Model building encourages a continuous improvement
mindset, where models are updated and adapted to reflect the current state of the system and address
emerging challenges.
Q10 What do you mean by Hungarian Method of Assignment? Explain various steps involved in
Hungarian Method of Assignment.
The Hungarian Method, also known as the Kuhn-Munkres algorithm, is a popular combinatorial optimization
algorithm used to solve the assignment problem. The assignment problem involves finding the most cost-
effective or profitable way to assign a set of tasks to a set of agents. The objective is to minimize the total cost
or maximize the total profit of the assignment.
The Hungarian Method consists of the following steps:
Step 1: Create the Cost Matrix

- Begin with a cost matrix where the rows represent the tasks and the columns represent the agents. Each cell
in the matrix contains the cost of assigning a particular task to a specific agent.
Step 2: Row Reduction

- For each row, find the smallest element and subtract it from every element in that row. This step ensures that
at least one zero is present in each row.

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Step 3: Column Reduction
- For each column, find the smallest element and subtract it from every element in that column. This step
ensures that at least one zero is present in each column.
Step 4: Identify the Minimum Number of Lines

- Use the modified matrix to identify the minimum number of lines (horizontal and vertical) needed to cover all
the zeros. This step involves a process called "line covering."
Step 5: Create Zeroes

- If the minimum number of lines equals the number of rows (or columns), an optimal assignment is possible. If
not, additional steps are needed to create more zeroes in the matrix.
Step 6: Modify the Matrix

- Modify the matrix to create additional zeroes by using the minimum uncovered value and adding it to the
intersection of covered rows and columns, and subtracting it from the intersection of doubly-covered rows and
columns.
Step 7: Repeat Steps 4-6

- Repeat steps 4-6 until an optimal assignment is achieved, i.e., the number of lines equals the number of
rows (or columns), indicating that an optimal assignment has been found.
The Hungarian Method is an efficient algorithm for solving the assignment problem and is widely used in
various fields such as operations research, logistics, and resource allocation. It provides a systematic
approach to finding the optimal assignment of tasks to agents while considering the associated costs or
profits.
Q11 What do you mean by Inventory Control? Explain various methods of inventory control with
special regard to Economic Order Quantity.
Inventory control refers to the process of managing and regulating the flow of goods and materials in a
company's inventory. The main goal of inventory control is to ensure that the right amount of stock is available
at the right time, while also minimizing carrying costs and avoiding stockouts.
There are several methods of inventory control, including:
1. Just-in-Time (JIT) Inventory Control: This method involves ordering and receiving inventory only when it
is needed for production or sales. This helps to minimize holding costs and reduce the risk of obsolescence,
but it requires a high level of coordination with suppliers and a reliable supply chain.
2. ABC Analysis: This method categorizes inventory items into three groups based on their value and usage.
A items are high-value items that are used frequently, B items are moderate-value items with moderate usage,
and C items are low-value items with low usage. This allows companies to focus their attention on managing
the most important items.
3. Vendor Managed Inventory (VMI): Under this method, the supplier takes responsibility for managing the
inventory levels of their products at the customer's location. This can help to reduce inventory holding costs
and improve supply chain efficiency.
One of the most widely used methods of inventory control is the Economic Order Quantity (EOQ) model. EOQ
is a formula used to determine the optimal order quantity that minimizes total inventory costs, including
ordering costs and holding costs. The EOQ formula takes into account the cost of placing an order, the cost of
holding inventory, and the demand for the product.
The EOQ formula is:
EOQ = √(2DS/H)
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Where:
- D = annual demand in units
- S = ordering cost per order
- H = holding cost per unit per year
By using the EOQ model, companies can determine the most cost-effective order quantity and minimize the
total cost of holding and ordering inventory. This helps to optimize inventory levels and improve overall
inventory management.
Q12 What do you mean by Network Analysis (PERT/CPM). Explain various rules for drawing a
network.
Network Analysis, also known as Program Evaluation and Review Technique (PERT) and Critical Path
Method (CPM), is a project management tool used to plan and control complex projects. PERT/CPM helps in
scheduling, coordinating, and controlling the activities within a project.
Rules for drawing a network in PERT/CPM include:
1. Identify the activities: List all the activities required to complete the project. Each activity should be clearly
defined and have a specific duration.
2. Determine the sequence of activities: Identify the logical sequence in which the activities need to be
performed. Some activities may be dependent on the completion of others.
3. Draw the network diagram: Use nodes to represent the activities and arrows to represent the flow and
sequence of activities. Nodes are drawn as circles or rectangles, and arrows indicate the direction and
dependencies between activities.
4. Determine the duration of each activity: Estimate the time required to complete each activity. This will
help in determining the overall project duration and critical path.
5. Identify the critical path: The critical path is the longest path through the network and represents the
shortest possible time for completing the project. It consists of activities that have zero slack or float, meaning
any delay in these activities will directly impact the project's completion time.
6. Calculate the earliest start and finish times: Determine the earliest start and finish times for each activity
based on the logical sequence and duration of activities.
7. Calculate the latest start and finish times: Determine the latest start and finish times for each activity,
which represent the latest possible start and finish times without delaying the project.
By following these rules for drawing a network in PERT/CPM, project managers can effectively plan, schedule,
and control the activities within a project, leading to improved project management and successful project
completion.
Q13.What do you mean by Transportation Model? Explain the various steps involved in formation of
optimum transportation model with hypothetical example.
The transportation model is a mathematical model used to determine the most cost-effective way to transport
goods from multiple sources to multiple destinations. It is commonly used in logistics and supply chain
management to optimize transportation routes and minimize transportation costs.
The steps involved in the formation of an optimum transportation model are as follows:

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1. Identify the sources and destinations: Determine the origins (sources) and destinations for the goods to
be transported. These could be warehouses, production facilities, or any other points of origin and delivery.
2. Determine the supply and demand: Identify the supply available at each source and the demand at each
destination. This could be in terms of quantities of goods available or required.
3. Calculate the transportation costs: Determine the cost of transporting goods from each source to each
destination. This could include factors such as distance, mode of transportation, and handling fees.
4. Formulate the transportation matrix: Create a transportation matrix that shows the costs of transporting
goods from each source to each destination. This matrix will serve as the basis for the transportation model.
5. Define decision variables: Assign decision variables to represent the quantities of goods to be transported
from each source to each destination. These variables will be used to optimize the transportation model.
6. Set up the objective function: Define the objective function, which is the total transportation cost. The goal
is to minimize this cost by optimizing the transportation routes and quantities.
7. Formulate the constraints: Establish constraints that reflect the supply and demand at each source and
destination. These constraints ensure that the total quantity of goods transported from each source does not
exceed the available supply, and the total quantity received at each destination meets the demand.
8. Solve the transportation model: Use mathematical optimization techniques, such as the transportation
simplex method, to solve the transportation model and determine the optimal transportation plan that
minimizes costs.
Hypothetical example:
Let's consider a hypothetical scenario where a company needs to transport goods from three warehouses
(W1, W2, W3) to four retail stores (R1, R2, R3, R4). The transportation costs per unit are as follows:
- From: W1 W2 W3 Supply
- To:
R1 6 8 10 35
R2 9 11 7 40
R3 12 10 6 30
R4 8 9 5 25
Demand 30 40 30
Using the transportation model, the company can determine the optimal transportation plan that minimizes the
total transportation cost while meeting the demand at each retail store.
Q14. Explain various kinds of Queuing system their assumptions

There are several types of queuing systems, each with its own set of assumptions and characteristics. Some
of the most common types include:
1. Single-Server Queuing System: This type of system assumes that there is only one server serving the
queue of customers. The arrival of customers and the service times are usually modeled using probability
distributions, and the system is often analyzed using metrics such as average waiting time and average queue
length.
2. Multi-Server Queuing System: In this type of system, there are multiple servers serving the queue of
customers. The assumptions for this type of system include the distribution of customers among the servers,
the service times for each server, and the overall system capacity.

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3. Finite Queue Length: This type of queuing system assumes that there is a maximum limit to the number of
customers that can be in the queue at any given time. This assumption is important for systems where there is
a physical limit to the number of customers that can be served, such as in a retail store or a bank.
4. Infinite Queue Length: In contrast to finite queue length, an infinite queue length system assumes that
there is no limit to the number of customers that can be in the queue at any given time. This type of system is
often used in theoretical models and is useful for analyzing long-term behavior and performance.
5. Priority Queuing System: This type of system assumes that customers are served based on a priority
order, rather than on a first-come-first-served basis. The assumptions for this type of system include the
priority rules, the distribution of customer priorities, and the impact of priority on system performance.
Q15. What do you mean by EOQ (Economic Order (Quantity). Explain various methods of Calculation
of EOQ.
Ans. Economic order quantity (EOQ) is the ideal order quantity a company should purchase for its inventory
given a set cost of production, demand rate and other variables. This is done to minimize variable inventory
costs, and the equation for EOQ takes into account storage, ordering costs and shortage costs. The full
equation is:
EOQ = √(2SD / H), or the square root of (2 x S x D / H).

S = Setup costs (per order, generally includes shipping and handling)
D = Demand rate (quantity sold per year)
H = Holding costs (per year, per unit)
Calculation Of Economic Order Quantity(EOQ)
The economic order quantity can be determined in the following ways.
1. Formula Method
With the help of following formula, the economic order quantity can be calculated.
2. Graphical Method
Under this method, the carrying cost, ordering cost and total cost are shown on graph. It is based on the
principle that the total carrying cost increases as the order size increases. However, the ordering cost
decreases if the order size increases. The point at which the ordering cost and carrying cost intersects each
other, total cost is minimum.

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3. Trial And Error Method
If the total needs of inventory for a form are known, the firm has different alternatives to purchase its
inventories. It can buy its total needs in a single order at the beginning of the year or the inventories may be
purchased in small orders periodically. If the purchase are made in one order, the average inventory holdings
will be relatively large whereas they will be relatively small when the acquisition of inventory is in small lots.
High average inventory would involve high carrying cost and low average inventory holdings are associated
with high ordering costs. According to this method, the carrying and ordering costs for different sizes of orders
to purchase inventories are computed and the order size with the lowest total cost of inventory is the
economic order quantity.
Q16. Define Operational Research. Explain its significance in decision making.
Operational Research (OR), also known as Operations Research, is a discipline that uses mathematical and
analytical methods to help make better decisions. It involves the application of advanced analytical methods
to help make better decisions and solve complex problems in areas such as logistics, supply chain
management, finance, marketing, and healthcare.
Significance in decision making:

1. Optimization: OR helps to optimize resources, processes, and systems. It allows organizations to
maximize efficiency and minimize costs by finding the best possible solutions to complex problems.
2. Decision Support: OR provides decision-makers with quantitative tools and models to support their
decision-making process. It helps in evaluating various options and selecting the best course of action.
3. Risk Analysis: OR helps in assessing and managing risks, allowing decision-makers to understand the
potential outcomes of different decisions and to make informed choices.
4. Forecasting and Planning: OR uses mathematical models to forecast future scenarios and plan for
various contingencies. This is particularly important in industries such as supply chain management, where
accurate forecasting and planning are crucial for efficient operations.
5. Performance Measurement: OR provides tools to measure the performance of systems and processes,
allowing organizations to identify areas for improvement and make data-driven decisions to enhance overall
performance.
6. Resource Allocation: OR helps in allocating resources such as manpower, inventory, and financial
resources in an optimal manner, ensuring that they are utilized effectively and efficiently.
Q17 What do you mean by Replacement Theory? Differentiate between individual replacement policy
and Group Replacement Policy.
Replacement theory is a branch of operations research that deals with the problem of replacing items or
equipment when they become old, obsolete, or worn out. The goal of replacement theory is to determine the
optimal time to replace an item in order to minimize costs or maximize efficiency.
Individual Replacement Policy:

- In individual replacement policy, each item is considered individually and replaced when it reaches a
certain level of deterioration or obsolescence.
- This policy is suitable for items that have varying lifespans and replacement costs, and where the decision
to replace each item is made independently of others.
Group Replacement Policy:

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- In group replacement policy, items are replaced in groups at fixed intervals, regardless of their individual
condition.
- This policy is suitable for items that have similar lifespans and replacement costs, and where the cost of
replacing items individually is high or impractical.
Difference between Individual and Group Replacement Policy:

1. Decision Making:
- Individual replacement policy makes decisions on a per-item basis, while group replacement policy makes
decisions on a group of items at the same time.
2. Timing:
- Individual replacement policy replaces items as they reach a certain level of deterioration, while group
replacement policy replaces items at fixed intervals regardless of their individual condition.
3. Cost:
- Individual replacement policy may result in varying replacement costs for each item, while group
replacement policy may result in more uniform and predictable replacement costs for the group of items.
Q18 Explain any five assumptions of Game theory.
Game theory is a mathematical framework used to analyze and study decision-making in competitive
situations. It is based on several key assumptions, including:
1. Rationality: Game theory assumes that all players in the game are rational, meaning they make
decisions to maximize their own utility or payoff. This assumption implies that players will always choose the
option that gives them the highest expected payoff, based on their beliefs about the other players'
strategies.
2. Complete information: Game theory assumes that all players have complete information about the
game, including knowledge of the rules, the available strategies, and the payoffs associated with each
possible outcome. This assumption allows for the analysis of strategic interactions with full knowledge of the
game's structure.
3. Simultaneous or sequential moves: Game theory distinguishes between games with simultaneous
moves (where players act simultaneously without knowledge of each other's actions) and games with
sequential moves (where players act in a specific order, with later players having knowledge of earlier
players' actions).
4. Payoff functions: Game theory assumes that each player has a well-defined payoff function that
quantifies their preferences over the possible outcomes of the game. These payoffs are typically
represented numerically and reflect the player's utility or satisfaction from different outcomes.
5. Common knowledge: Game theory assumes that players have common knowledge of the game,
meaning they know the game's structure, the rationality of the other players, and the rationality of the other
players' knowledge of the game. This assumption is important for analyzing strategic interactions and the
reasoning behind players' actions.
These assumptions form the foundation of game theory and are essential for understanding and analyzing
strategic decision-making in various competitive situations.
Q19 What do you mean by Decision Theory? Explain various types of Decision making Environment
along with suitable decision criteria in each kind of environment.
Decision theory in operations research is a field that focuses on the study of decision-making processes in
the context of operational management and optimization. It involves analyzing and understanding how

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individuals and organizations make decisions when faced with uncertainty and risk, with the goal of
identifying the best course of action to achieve operational objectives.
Types of Decision-Making Environments in Operations Research:
1. Certainty: In a certainty environment, decision-makers have complete and precise information about the
available alternatives and their potential outcomes. The outcomes of each alternative are known with
certainty. Decision criteria in a certainty environment include:
- Maximax: Selecting the alternative that maximizes the best possible outcome.
- Maximin: Selecting the alternative that maximizes the worst possible outcome.
- Equally likely: Selecting the alternative with the highest average outcome.
2. Risk: In a risk environment, decision-makers have knowledge of the available alternatives and their
potential outcomes, but the probabilities of these outcomes are known. Decision criteria in a risk
environment include:
- Expected Monetary Value (EMV): Selecting the alternative with the highest expected payoff, calculated
as the sum of each outcome's value multiplied by its probability.
- Expected Utility: Selecting the alternative with the highest expected utility, which incorporates the
decision-maker's risk preferences and attitudes towards uncertainty.
3. Uncertainty: In an uncertainty environment, decision-makers lack complete information about the

available alternatives and their potential outcomes. The probabilities of outcomes are unknown or difficult to
estimate. Decision criteria in an uncertainty environment include:
- Minimax Regret: Selecting the alternative that minimizes the maximum regret, where regret is the
difference between the best possible outcome and the actual outcome for each alternative.
- Hurwicz Criterion: Selecting the alternative based on a weighted average of the best and worst
outcomes, reflecting the decision-maker's risk attitude.
4. Ambiguity: In an ambiguous environment, decision-makers not only lack complete information about the
available alternatives and their potential outcomes but also face unclear or subjective probabilities. Decision
criteria in an ambiguous environment may involve using qualitative assessments, expert opinions, or
scenario analysis to make decisions under ambiguity.
In operations research, decision theory provides a systematic approach for evaluating and selecting the best
course of action in each type of decision-making environment, taking into account the level of uncertainty
and risk involved in operational decision-making. This helps in optimizing operational processes, resource
allocation, and strategic planning.
Q20 What do you mean by Assignment Problem? Explain various steps involved in Hungarian method
of Assignment.
The Assignment Problem is a fundamental problem in operations research that involves assigning a set of
tasks to a set of resources in a way that minimizes the total cost or maximizes the total profit. It is a special
case of the transportation problem and has applications in various fields such as logistics, scheduling, and
resource allocation.
The Hungarian method is a popular algorithm for solving the Assignment Problem. It involves the following
steps:
Step 1: Create the Cost Matrix

- Start with a cost matrix representing the cost of assigning each task to each resource. If the objective is to
maximize profit, the matrix would represent the profit of each assignment.
Step 2: Reduce the Matrix

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- For each row of the cost matrix, find the smallest element and subtract it from every element in the row. Do
the same for each column. This step is known as matrix reduction and helps in finding an initial feasible
solution.
Step 3: Identify Zeroes and Mark Lines

- Identify the minimum number of lines (rows and columns) needed to cover all the zeroes in the reduced
matrix. This step is essential for finding an optimal assignment.
Step 4: Test for Optimality

- Check if the number of lines equals the order of the matrix. If yes, an optimal assignment has been found,
and the algorithm proceeds to the next step. If not, go to Step 5.
Step 5: Modify the Matrix and Repeat

- Modify the reduced matrix to create additional zeroes without changing the lines. This step involves
adjusting the cost matrix based on the lines drawn in Step 3. Then, return to Step 3 and repeat the process.
Step 6: Make Assignments

- Make assignments based on the pattern of zeroes in the modified matrix. If there are exactly n
assignments (where n is the number of tasks or resources), the algorithm has found an optimal solution. If
not, go back to Step 5 and repeat the process.
The Hungarian method guarantees finding the optimal solution to the Assignment Problem in polynomial
time, making it an efficient and widely used algorithm for solving assignment and matching problems in
operations research and related fields.
Q21 Explain Various steps involved in solving Transportation problems.

The transportation problem is a classic problem in operations research that involves optimizing the
transportation of goods from a set of suppliers to a set of demand points while minimizing the total
transportation cost. The problem can be solved using various methods, such as the North-West Corner
Method, Least Cost Method, and Vogel's Approximation Method. Here are the steps involved in solving the
transportation problem using a basic method:
Step 1: Formulate the Problem

- Define the supply points, demand points, and the transportation cost from each supply point to each
demand point. Create a transportation cost matrix representing these costs.
Step 2: Apply the North-West Corner Method

- Start at the top-left (North-West) corner of the cost matrix. Allocate as much as possible to the cell's row or
column, based on the supply and demand constraints. Update the supply and demand values accordingly.
Step 3: Check for Optimality

- Check if the supply and demand constraints are satisfied. If not, proceed to the next step.
Step 4: Apply the Minimum Cost Method

- Identify the cell with the lowest transportation cost among the remaining unfilled cells. Allocate as much as
possible to this cell, based on the supply and demand constraints. Update the supply and demand values.
Step 5: Check for Optimality and Repeat

- Check if the supply and demand constraints are satisfied. If not, repeat Step 4 until all supply and demand
requirements are met.
Step 6: Calculate Total Cost

- Calculate the total transportation cost by multiplying the allocated quantities with their respective
transportation costs and summing them up.

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These basic steps provide a simple approach to solving the transportation problem. However, more
advanced methods, such as the Modified Distribution Method and Vogel's Approximation Method, can be
used to improve the efficiency and optimality of the solution.
It's important to note that the transportation problem can also be formulated as a linear programming
problem and solved using optimization techniques such as the simplex method or interior point methods to
find an optimal solution.
Q22 What do you understand by Decision Tree Analysis? Explain with the help of hypothetical
example the procedure to be followed for taking decision under this technique.
Decision tree analysis is a decision-making tool that uses a tree-like model of decisions and their possible
consequences. It is a predictive modeling approach that is used to visually and explicitly represent decisions
and decision making.
The procedure for decision tree analysis involves the following steps:
1. Gathering Data: The first step in decision tree analysis is to gather relevant data related to the decision
or problem at hand. This data could include historical information, customer preferences, market trends, and
other relevant factors.
2. Defining the Decision: The next step is to clearly define the decision that needs to be made. This could
be a business decision, such as whether to launch a new product, or a personal decision, such as whether
to buy a new car.
3. Identifying Alternatives: Once the decision is defined, the next step is to identify the possible
alternatives or choices that are available. For example, in the case of launching a new product, the
alternatives could include different product features, pricing strategies, and marketing approaches.
4. Building the Decision Tree: The decision tree is then constructed using the gathered data and identified
alternatives. The tree is made up of nodes, which represent decision points, and branches, which represent
the possible outcomes of each decision. The tree is built in a way that allows for the calculation of the
expected value of each decision.
5. Analyzing the Tree: Once the decision tree is constructed, it is analyzed to determine the best course of
action. This involves calculating the expected value of each decision and choosing the alternative with the
highest expected value.
Hypothetical Example:
Let's say a company is trying to decide whether to invest in a new marketing campaign. The decision tree
would have nodes representing the decision points, such as the budget for the campaign and the target
audience. The branches would represent the possible outcomes of each decision, such as the potential
increase in sales and the associated costs. By analyzing the decision tree, the company can determine the
best course of action based on the expected value of each decision.
Q23 What do you understand by CPM and PERT techniques for project management? How are they
useful in project management?
CPM (Critical Path Method) and PERT (Program Evaluation and Review Technique) are both project
management techniques used to plan, schedule, and control projects. They are useful in project management
for their ability to analyze and manage complex projects, identify critical activities, and estimate project
completion times.
CPM (Critical Path Method): CPM is a project management technique used to identify the critical path in a
project schedule. The critical path is the sequence of activities that determines the minimum amount of time

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required to complete the project. CPM helps in identifying the activities that are critical to the project's timeline
and allows project managers to focus on those activities to ensure the project is completed on time.
PERT (Program Evaluation and Review Technique): PERT is a project management technique used to
analyze and represent the tasks involved in completing a project. It uses a network model to represent the
sequence of activities and their dependencies. PERT also incorporates uncertainty in the project schedule by
using three time estimates for each activity: optimistic, pessimistic, and most likely. This allows for a more
realistic estimation of project completion time and helps in managing project risks.
Both CPM and PERT techniques are useful in project management for the following reasons:
1. Planning and Scheduling: Both techniques help in planning and scheduling project activities, determining
their sequence, and estimating the time required to complete each activity.
2. Identifying Critical Activities: CPM and PERT help in identifying critical activities that can impact the
overall project timeline. By focusing on critical activities, project managers can ensure that the project is
completed on time.
3. Resource Allocation: These techniques help in identifying the resources required for each activity and
ensuring that resources are allocated efficiently to meet project deadlines.
4. Risk Management: PERT incorporates uncertainty in project schedules, allowing project managers to
account for potential delays and manage project risks effectively.
Q24 What are the steps in solving air crew assignment model?
The air crew assignment model is a problem in operations research that involves assigning crew members to
flights in a way that minimizes costs and meets certain constraints. The steps in solving the air crew
assignment model typically involve the following:
1. Formulating the problem: Define the objective function (e.g., minimizing costs or maximizing crew
satisfaction), constraints (e.g., crew availability, legal regulations), and decision variables (e.g., which crew
member is assigned to which flight).
2. Data collection: Gather information about flight schedules, crew availability, costs, and any other relevant
data.
3. Model implementation: Use mathematical programming techniques, such as linear programming or

integer programming, to create a model that represents the problem.
4. Solving the model: Use optimization software or algorithms to solve the model and find the best
assignment of crew members to flights.
5. Analysis and validation: Evaluate the results of the model to ensure that they meet the objectives and
constraints of the problem.
6. Implementation: Use the results of the model to make crew assignments for actual flights.
Q25 What do you mean by sequencing problems? Explain various assumptions of sequencing
problems?
Sequencing problems refer to the task of arranging a set of items or events in a specific order according to
certain criteria or constraints. These problems are commonly encountered in various fields such as logistics,
scheduling, production planning, and computer science.
Various assumptions of sequencing problems include:

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1. Precedence constraints: This assumption states that certain items or events must occur before others. For
example, in a production scheduling problem, certain tasks may need to be completed before others can
begin.
2. Resource constraints: This assumption considers the limitations of resources such as time, manpower, or
equipment. For example, in a job scheduling problem, the availability of machines or workers may limit the
order in which tasks can be performed.
3. Objective function: Sequencing problems often involve optimizing a certain objective, such as minimizing
completion time, maximizing throughput, or minimizing the use of resources.
4. Uncertainty: This assumption acknowledges that there may be uncertainty or variability in the processing
times, arrival times, or other parameters of the sequencing problem.
5. Single or multiple criteria: Sequencing problems may involve optimizing a single objective or multiple
conflicting objectives, such as minimizing costs while maximizing customer satisfaction.
6. Deterministic or stochastic: Sequencing problems may be deterministic, where all parameters are known
with certainty, or stochastic, where some parameters are uncertain and follow a probabilistic distribution.
Q26 A company uses Rs. 50000 material per year. The cost per order is Rs. 50 and carrying cost is 20
percent of the average inventory. The company currently has an optimum purchasing policy but has
been offered a 0.4 percent discount if they purchase 5 times per year. Should the offer be accepted? If
not what counter offer should be made?
To determine whether the offer should be accepted, we can compare the total cost under the current policy
with the total cost under the new offer.
First, let's calculate the total cost under the current policy:
Given:
Annual material cost (C) = Rs. 50000
Cost per order (S) = Rs. 50
Carrying cost (H) = 20% of the average inventory
The current order quantity (EOQ) can be calculated using the Economic Order Quantity formula:
EOQ = sqrt((2 * C * S) / H)
where:
C = Annual material cost
S = Cost per order
H = Carrying cost
Using the given values:

EOQ = sqrt((2 * 50000 * 50) / 0.20)
EOQ ≈ 500 units
Now, let's calculate the total cost under the current policy:
Total cost = (C / EOQ) * S + (EOQ / 2) * H
Total cost = (50000 / 500) * 50 + (500 / 2) * 0.20
Total cost = 500 * 50 + 250 * 0.20
Total cost = 25000 + 50
Total cost = Rs. 25050 per year
Now, let's calculate the total cost under the new offer:

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The company has been offered a 0.4% discount if they purchase 5 times per year.
Under the new offer, the order quantity (Q) can be calculated as:
Q=C/n
where:
C = Annual material cost
n = Number of orders per year
Using the given values:

Q = 50000 / 5
Q = 10000 units
Total cost under the new offer is:

Total cost = (C / Q) * S + (Q / 2) * H
Total cost = (50000 / 10000) * 50 + (10000 / 2) * 0.20
Total cost = 5 * 50 + 5000 * 0.20
Total cost = 250 + 1000
Total cost = Rs. 1250 + 1000
Total cost = Rs. 26000 per year
Now, let's compare the total costs:

Current total cost = Rs. 25050 per year
New offer total cost = Rs. 26000 per year
Since the total cost under the new offer is higher, the company should not accept the offer to purchase 5 times
per year with a 0.4% discount.
To make a counter offer, the company could negotiate for a larger discount or a lower cost per order to ensure
that the total cost under the new offer is lower than the current total cost.
Q27. Define operation research as a decision making science.
1. Decision-making science: Operations research is a discipline that focuses on providing quantitative

insights and recommendations to decision-makers. It employs mathematical models, statistical analysis,
optimization algorithms, and simulation methods to support decision-making processes.
2. Optimization and efficiency: The main goal of operations research is to optimize the use of resources and
improve decision-making efficiency. By formulating mathematical models and using optimization techniques,
organizations can find the best possible solutions to complex problems.
3. Mathematical modeling: Operations research involves formulating mathematical models that represent
real-world problems. These models capture the relevant variables, constraints, and objectives of the problem
at hand, allowing decision-makers to analyze and evaluate different scenarios.
4. Quantitative analysis: Operations research utilizes quantitative methods to analyze the mathematical
models and generate insights. These methods include mathematical optimization, statistical analysis, and
simulation techniques, which help decision-makers understand the implications of their decisions and evaluate
potential outcomes.
5. Wide range of applications: Operations research can be applied to various domains and industries,
including production planning, inventory management, logistics, scheduling, healthcare management, energy
optimization, and financial planning. It provides decision-makers with a framework to tackle complex problems
in different sectors.
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6. Decision-making process: The decision-making process in operations research typically involves several
steps. These include problem identification, model development, data collection and analysis, parameter
estimation, optimization, and simulation. This systematic approach helps decision-makers make informed
choices based on rigorous analysis.
7. Optimization techniques: Operations research employs optimization techniques, such as linear

programming, integer programming, or dynamic programming, to find optimal or near-optimal solutions. These
algorithms help decision-makers determine the best values for decision variables that maximize or minimize a
given objective function while satisfying the constraints.
8. Simulation methods: Operations research also utilizes simulation methods to assess the performance of
different decision strategies. By creating computer-based simulations of real systems, decision-makers can
evaluate the impact of their decisions under various scenarios and test the robustness of their strategies.
9. Reduction of uncertainty and risks: By using operations research techniques, decision-makers can
reduce uncertainty and minimize risks associated with their decisions. The quantitative analysis and modeling
allow them to evaluate the potential outcomes and trade-offs involved, leading to more informed and confident
decision-making.
10. Improved efficiency and competitiveness: Operations research enables organizations to make data-
driven decisions that lead to improved efficiency, cost savings, and competitive advantages. By optimizing
resource allocation, streamlining processes, and making informed choices, organizations can enhance their
performance and achieve their goals more effectively.
Q28.What do you mean by Transportation Model ? Explain the various steps involved in formation of
optimum transportation model with hypothetical example.
The Transportation Model is a mathematical optimization technique used to determine the optimal allocation
of goods from various sources (e.g., factories, warehouses) to different destinations (e.g., customers, retail
outlets) while minimizing transportation costs. It is widely used in logistics and supply chain management.
The steps involved in the formation of an optimum transportation model are as follows:
1. Identify sources and destinations: Determine the sources (e.g., factories, warehouses) and
destinations (e.g., customers, retail outlets) involved in the transportation problem. Assign a supply quantity
(availability) for each source and a demand quantity (requirement) for each destination.
2. Define the decision variables: Define the decision variables that represent the quantity of goods to be
transported from each source to each destination. These decision variables are typically denoted by Xij,
where i represents the source and j represents the destination.
3. Formulate the objective function: The objective of the transportation model is to minimize the total
transportation cost. The objective function is usually expressed as the sum of the transportation cost per unit
of goods multiplied by the quantity of goods transported from each source to each destination.
4. Set up the constraints: The transportation model has two types of constraints: supply constraints and
demand constraints. The supply constraints ensure that the total quantity of goods shipped from each
source does not exceed its supply capacity. The demand constraints ensure that the total quantity of goods
received at each destination meets its demand requirement.
5. Formulate the mathematical model: Combine the objective function and the constraints to formulate the
mathematical model. The model is typically represented as a linear programming problem.

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6. Solve the model: Apply optimization techniques, such as the simplex method or transportation algorithm,
to solve the transportation model and find the optimal solution. These techniques determine the values of
the decision variables that minimize the transportation cost while satisfying the supply and demand
constraints.
7. Interpret the results: Once the model is solved, interpret the results to understand the optimal allocation
of goods from sources to destinations. This includes identifying the quantity of goods to be transported from
each source to each destination and the associated transportation cost.
Here's a hypothetical example to illustrate the steps involved in forming an optimum transportation
model:
Suppose there are three factories (F1, F2, F3) and four retail outlets (R1, R2, R3, R4). The supply capacities
of the factories are 100, 150, and 200 units, respectively, and the demand requirements of the retail outlets
are 80, 120, 100, and 150 units, respectively. The transportation cost per unit from each factory to each
retail outlet is given as follows:
R1 R2 R3 R4
F1 4 6 9 7
F2 5 8 7 6
F3 6 3 4 5
Now, let's go through the steps:
1. Identify sources and destinations: The sources are F1, F2, and F3 (factories), and the destinations are
R1, R2, R3, and R4 (retail outlets).
2. Define decision variables: Let Xij represent the quantity of goods transported from factory i to retail
outlet j.
3. Formulate the objective function: Minimize the total transportation cost, which is the sum of the
transportation cost per unit multiplied by the quantity of goods transported from each factory to each retail
outlet.
4. Set up the constraints: Ensure that the total quantity of goods shipped from each factory does not
exceed its supply capacity and that the total quantity of goods received at each retail outlet meets its
demand requirement.
5. Formulate the mathematical model: Combine the objective function and the constraints to formulate the
linear programming problem.
6. Solve the model: Apply the transportation algorithm or other optimization techniques to find the optimal
solution.
7. Interpret the results: Interpret the optimal solution to determine the quantity of goods to be transported
from each factory to each retail outlet and the associated transportation cost.
By following these steps, the transportation model helps in making informed decisions regarding the
allocation of goods, minimizing transportation costs, and meeting supply and demand requirements
efficiently.
Q29. What do you mean by Decision Tree Analysis? Explain its Process and Importance
Decision tree analysis is a powerful tool used in decision-making and problem-solving processes. It is a
visual representation of a series of decisions and their potential outcomes, allowing individuals or

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organizations to evaluate different options and make informed choices. The process of decision tree
analysis involves several steps:
1. Define the Decision: The first step is to clearly define the decision or problem that needs to be
addressed. This could be anything from choosing between different investment options to selecting the best
marketing strategy.
2. Identify Alternatives: Next, identify the various alternatives or options available to address the decision.
These alternatives should be mutually exclusive and collectively exhaustive, meaning that they cover all
possible outcomes.
3. Determine Outcomes: For each alternative, determine the potential outcomes or consequences that
could result from choosing that option. These outcomes can be positive (gains, benefits) or negative (losses,
costs).
4. Assign Probabilities: Assign probabilities to each outcome based on the likelihood of it occurring. These
probabilities can be estimated based on historical data, expert opinions, or other relevant information. It is
important to be as accurate as possible in assigning probabilities to ensure the reliability of the analysis.
5. Calculate Expected Values: Calculate the expected value for each alternative by multiplying the
probability of each outcome by its associated value (positive or negative). The expected value represents
the average outcome if that alternative is chosen.
6. Construct the Decision Tree: Using a diagrammatic representation, construct the decision tree by
connecting the alternatives, outcomes, and their associated probabilities and expected values. The decision
tree typically starts with a decision node representing the initial decision and branches out to chance nodes
representing the different outcomes.
7. Analyze the Decision Tree: Analyze the decision tree by evaluating the expected values associated with
each alternative. Compare the expected values to determine the best course of action. The alternative with
the highest expected value is typically considered the best choice.
The importance of decision tree analysis lies in its ability to provide a structured and visual framework for
decision-making. It helps individuals or organizations consider all possible alternatives, assess their
potential outcomes, and weigh the associated probabilities. Decision tree analysis allows for a systematic
evaluation of risks and rewards, enabling informed decision-making based on objective data. It also helps
identify the most favorable alternative and provides insights into the potential impact of different choices. By
using decision tree analysis, individuals and organizations can make more rational and effective decisions,
reducing biases and uncertainties in the decision-making process.
Q30.What do you mean by game theory? Explain various assumptions of game theory.
Game theory is a branch of mathematics and economics that studies strategic decision-making in situations
where the outcome of an individual's choice depends on the choices made by others. It provides a framework
for analyzing and understanding the interactions between rational decision-makers, known as players, in
competitive or cooperative situations.
Assumptions of game theory include:
1. Rationality: Game theory assumes that players are rational and act in their own self-interest. They make
decisions based on maximizing their own utility or payoff.
2. Complete Information: It assumes that players have complete information about the game, including
knowledge of the rules, available strategies, and payoffs associated with different outcomes.
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3. Common Knowledge: Game theory assumes that players have common knowledge, meaning they know
that all players have the same information about the game and are aware of this fact.
4. Simultaneous or Sequential Moves: Games can be classified as either simultaneous or sequential.

Simultaneous games involve players making decisions simultaneously without knowledge of the other players'
choices. Sequential games involve players taking turns, with each player making decisions based on the
previous player's choice.
5. Finite Number of Players and Strategies: Game theory typically assumes a finite number of players and a
finite set of strategies available to each player. This simplifies the analysis and allows for mathematical
modeling.
6. No Cooperation or Communication: In many game theory models, players are assumed to act
independently and without the ability to cooperate or communicate with each other. This assumption helps
analyze strategic interactions in situations where players cannot trust or coordinate with each other.
These assumptions provide a foundation for analyzing various types of games, such as simultaneous-move
games like the Prisoner's Dilemma, sequential-move games like Chess, and cooperative games like the Nash
bargaining problem. By studying these games, game theory helps predict and understand strategic behavior
and outcomes in a wide range of real-world scenarios.

01765-520048,01763502165,8727800190

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The primary objectives of operations research include:

2. Explain the linear programming problem giving suitable examples.

Let's assume the following:

- Profit per unit of Product A: $10

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Subject to the constraints:

3. What do you mean by no passing rule?

4. What do you mean by unbalanced assignment problem?

| | Task X | Task Y | Task Z |

5. What do you mean by unbalanced transportation problem?

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6. What is a replacement problem?

Common examples of replacement problems include:

7. What is queue discipline?

Several common queue disciplines include:

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8. What is critical path?

Key characteristics of the critical path include:

9. What do you mean by carrying cost of inventory?

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Carrying costs typically include the following components:

10. What are the essential characteristics of linear programming model?

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12. Explain the use of artificial variables in L.P. P.

13. What do you mean by a transportation problem?

| | Task X | Task Y | Task Z |

15. What are the limitations of Game theory?

17. What is CPM?

18. What is Slack?

19. What do you mean by ABC Analysis?

LONG ANSWER TYPE QUESTIONS

Q2 Explain various applications of Linear Programming Problems (LPP).

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For the matching player:

For the non-matching player:

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Process of Decision Tree Analysis:

Importance of Decision Tree Analysis:

a. Average number of persons waiting and making telephone calls:

The average number of persons in the system (L) is given by:

So, W = 1 / (1/3) = 3 minutes.

Now, we can calculate the average number of persons in the system:

b. Average length of the queue:

Using the same values as above:

e. The average time spent by a customer in the telephone booth:

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1. Abstraction of Real-World Problems: Operations research involves addressing complex real-world

5. Quantitative Analysis: Models enable quantitative analysis of problems by representing relationships

6. Communication and Collaboration: Model building encourages collaboration among multidisciplinary

The Hungarian Method consists of the following steps:

Step 1: Create the Cost Matrix

Step 2: Row Reduction

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Step 4: Identify the Minimum Number of Lines

Step 5: Create Zeroes

Step 6: Modify the Matrix

Step 7: Repeat Steps 4-6