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1. Brown’s, a local bakery, is worried about increased costs—particularly energy

1.
Brown’s, a local bakery, is worried about increased costs—particularly energy. Last year’s records can provide a fairly good estimate of the parameters for this year. Wende Brown, the owner, does not believe things have changed much, but she did invest an additional $3,500 for modifications to the bakery’s ovens to make them more energy-efficient. The modifications were supposed to make the ovens at least 15% more efficient. Brown has asked you to check the energy savings of the new ovens (Calculate Labor, Capital Invested, Energy, and multifactor productivity) and also to look over other measures of the bakery’s productivity to see if the modifications were beneficial. You have the following data to work with:
LAST YEAR
NOW
Production (dozen)
2.
Kelle Carpet and Trim installs carpet in commercial offices. Peter Kelle has been very concerned with the amount of time it took to complete several recent jobs. Some of his workers are very unreliable. A list of activities and their optimistic completion time, the most likely completion time, and the pessimistic completion time (all in days) for a new contract are given in the following table:
Activity
Immediate Predecessor(s)
Time Estimates (in weeks)
Optimistic (a)
Most Likely (m)
Pessimistic (b)
A

3
6
8
B

2
4
4
C

1
2
3
D
C
6
7
8
E
B, D
4
6
8
F
A, E
6
10
14
G
A, E
1
2
4
H
F
3
6
9
I
G
10
11
14
J
C
14
16
20
K
H, I
3
6
10
(5 points) Draw AON diagram of the project, including activity d…
5 points bonus If you solve the question using Excel OM
3.
The monthly sales for Yazici Batteries, Inc., were as follows:
Month
Sales
January
24
February
21
March
13
April
14
May
13
June
16
July
17
August
18
September
26
October
20
November
21
December
23
Forecast January sales using each of the following:
(3 points) Naive method and3-month moving average.
(4 points)A 6-month weighted average using .1, .1, .1, .2, .2, and .3, with the heaviest weights applied to the most recent months.
(4 points) Exponential smoothing using an a = .3 and a September forecast of 18.
(4 points) A trend projection.
(5 points) Comparing MAD, MSE, and MAPE results, which forecasting method is the best?
5points bonus If you solve the question using Excel OM
4.
McBurger, Inc., wants to redesign its kitchens to improve productivity and quality. Three designs, called designs K1, K2, and K3, are under consideration. No matter which design is used, daily production of sandwiches at a typical McBurger restaurant is for 500 sandwiches. A sandwich costs $1.30 to produce. Non-defective sandwiches sell, on the average, for $2.50 per sandwich. Defective sandwiches cannot be sold and are scrapped. The goal is to choose a design that maximizes the expected profit at a typical restaurant over a 300-day period. Designs K1, K2, and K3 cost $80,000, $100,000, and $140,000, respectively. Under design K1, there is a .80 chance that 90 out of each 100 sandwiches are non-defective and a .20 chance that 70 out of each 100 sandwiches are non-defective. Under design K2, there is a .85 chance that 90 out of each 100 sandwiches are non-defective and a .15 chance that 75 out of each 100 sandwiches are non-defective. Under design K3, there is a .90 chance that 95 out of each 100 sandwiches are non-defective and a .10 chance that 80 out of each 100 sandwiches are non-defective. What is the expected profit level of the design that achieves the maximum expected 300-day profit level?
5points bonus If you solve the question using Excel OM

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