Operational Management Questions

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HOMEWORK ASSIGNMENT 4

Chapter 15 – Problem 9

Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used as a raw material by manufacturers of plastic goods around the U.S. SP currently operate four manufacturing centers in Philadelphia, PA; Atlanta, GA; St. Louis, MO; and Salt Lake City, UT. The plants have different capacities and production costs as indicated in the table below:

Maximum Capacity               Production Costs

PLANT                                                 (x 100,000 lbs.)                    (per 1,000 lbs)

Philadelphia                                                 7.5                                      $325.00

Atlanta                                                          9.0                                      $275.00

St. Louis                                                      12.0                                      $305.00

Salt Lake City                                             10.3                                      $250.00

SP currently has six contract customers located in New York City, Birmingham, AL; Terre Haute, IN; Dallas, TX; Spokane, WA and San Diego, CA. Transportation costs between the plants and various customers, as well as contracted demand from each customer, are shown in the table below:

                                                          Transportation Costs per 1,000 lbs_______

From/To            NYC   Birmingham    Terre Haute    Dallas    Spokane    San Diego

Philadelphia      $45          $52                   $56              $62            $78            $85

Atlanta               $55          $42                   $58              $59            $80            $82

St. Louis             $57          $60                   $50              $54            $65            $70

Salt Lake City    $72          $71                   $67              $57            $52            $60

Total Demand   525         415                   925              600             325           400

  1. Create a solver model and find the optimal solution to help SP develop a distribution plan that will minimize the costs to supply the customer’s demand
  2. Comment briefly on your solution. Beyond the obvious, does your proposed solution have any other implications for SP?

 

 

 

Chapter 18 – Problem 7

The following table contains the demand from the last 10 months:

MONTH ACTUAL DEMAND MONTH ACTUAL DEMAND
     1     31      6     36
     2     34      7     38
     3     33      8     40
     4     35      9     40
     5     37     10     41

 

  1. Calculate the single exponential smoothing forecast for these data using an α of .30 and an initial forecast (F1) of 31.
  2. Calculate the exponential smoothing with trend forecast for these data using an α of .30, a δ of .30, and an initial trend forecast of (T1) of 1, and an initial exponentially smoothed forecast of (F1) of 30.
  3. Calculate the mean absolute deviation (MAD) for each forecast. Which is best?

Chapter 18 – Problem 15

Historical demand for a product is:

                            DEMAND

January                        12

February                      11

March                           15

April                              12

May                               16

June                               15

  1. Using a weighted moving average with weights of 0.60, 0.30, and 0.10, find the July forecast. Remember to use the largest weight for the most recent month.
  2. Using the simple three-month moving average, find the July forecast.
  3. Using single exponential smoothing with an α of .20 and a June forecast of 13, find the July forecast. Make whatever assumptions you wish.
  4. Using simple linear regression analysis, calculate the regression equation for the preceding demand data.
  5. Using the regression equation in d, calculate the forecast for July.

 

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