SECTION A: ANSWER ALL QUESTIONS IN THIS SECTION [50 MARKS]
Mary is considering opening a grocery store in Manzini town. She is evaluating 3 sites: Down town, Bunu Mall and Riverstone. Mary calculated the value of successful stores at these locations with Bunu Mall being E300, 000, Downtown being E250, 000 and Riverstone being E400, 000. Mary also knows that the losses if unsuccessful would be El 00, 000 at either Downtown or Bunu Mall and E200, 000 at Riverstone. Mary figures her chances to be 50% Downtown, 75% at Riverstone and 60 at Bunu Mall. A friend also suggested that Mary could choose to not open a grocery store. Use the decision tree method to recommend the best option for Mary
Helen Murvis, hospital administrator for Portland General Hospital, is trying to determine whether to build a large wing onto the existing hospital or to build a small wing. If the population of Portland continues to grow, a large wing could return $150,000 to the hospital each year. If the small wing were built, it would return $60,000 to the hospital each year if the population continues to grow. If the population of Portland remains the same, the hospital would encounter a loss of $85,000 if the large wing were built. Furthermore, a loss of $45,000 would be realized if the small wing was constructed and the population remains the same. Unfortunately, Helen does not have any information about the future population of
(c) Using the equally likely criterion determines the best alternative. [20 MARKS].
Given annual demand of 2000 bags of cement, cost of replenishing an order of R400, a carrying cost percentage of 25 per cent of the purchase price per bag of Rl 00, determine the Economic Order Quantity level and total minimum inventory cost when you have a container that can only take 250 bags.
SECTION B: ANSWER ANY TWO (2) QUESTIONS OF YOUR CHOICE FROM
THIS SECTION: EACH QUESTION CARRIES 25 MARKS.
Continental Corporation specialises in the sales and service of video cameras. These cameras
are imported from Japan by monthly order using the internet. A 1-month lead time makes
accurate forecast of the next month’s expected demand extremely important.
The company had monthly sales compiled for the past 12 months as shown in the following
Monthly sales of video cameras during the past year
What are forecast sales for month 13?
one of the above two forecasting method is superior to the other?
Consider some youths who have teamed up to manufacture car security systems. They
specialise in making two types of anti-burglar gadgets. Type 1 is made up of a length of steel rod with two hook-like ends, one of which is to fit under the clutch pedal and the other end fits over the steering wheel. The two hooks are then held in place and secured by an adjustable steel latch-padlock arrangement. Type 2 is also made up of the same length of steel rod connecting two steel plate formed shapes. One form fits over gear lever while the other fits over the handbrake lever.
The two forms and the steel rod are then held in place in a manner similar to that used by Type 1 lock, using a latch-padlock arrangement. The youths are able to sell all the car locks they can produce because of the recent increases in car thefts. Unfortunately, they can only get a maximum of 50 padlocks, 6m2 of steel sheet and 30 m of steel rods per week. Each clutch lock is made up of0,75m rod. Each gear lock requires 0,4 m rod and 0,2m2 steel sheet. Of course, each lock type is fitted with only one padlock. A clutch lock brings in a profit contribution of $50, while a gear lock brings in $70.
How many of each type of locking system should the youths produce in order to maximise
their total weekly profit contribution?
END OF QUESTION PAPER: GOOD LUCK!