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USN

lOMBA33
Third Semester MBA Degree Examination, December 2011
Operations Management
Time: 3 hrs.
Max. Marks: 100
Note: Answer any FIVE full questions.
1 a. What isEOQ? (03Marks)
b. What isBEP? What istheunderlying assumption? (07Marks)
c. ABC company plans to sell anarticleat alocal market. Thearticles arepurchased at Rs.5 on
thecondition that all unsold articles shall bereturned. Therent for thespaceisRs.2000. The
articles will besoldat Rs.9. Determine thenumber of articles which must besold:
i) Tobreak even
ii) ToearnRs.400 asprofit
iii) If thecompany sells 750articles, calculate margin of safety andprofit. (10Marks)
2 a. Discuss theconcept of "make or buy" decision. (03Marks)
b. A company isinvestigating thedecision whether tomake or buy aplastic packaging which
iscurrently bein urchased at Rs.7each. Thedemand estimates areshown below.
Demand (units) 20000 30000 40000 50000 60000
Chance(%) '10 30 40 15 5
The decision to manufacture inhouse, costs the company an annual fixed cost of
Rs.80000 towards renovation andconditioning. Variable costs areestimated atRs.5 per unit.
Give your decision whether to make or buy. At what quantity is profitable to produce
rather thanbuy? (07Marks)
c. Usin cost analysis method select themost advanta eous location for settin up aplant.
Particulars LocationA LocationB LocationC
i) Total investment 200000 200000 200000
ii) Total ex ected sales 250000 300000 250000
iii) Distribution ex enses 40000 40000 75000
iv) Raw material ex enses 70000 80000 90000
v) Power su ly ex enses 40000 30000 20000
vi) Wa esandsalary 20000 25000 20000
vii) Other ex enses 25000 40000 30000
viii) Community attitude Indifferent Good Indifferent
ix) Em loyeehousin facilities Poor Excellent Good
(10Marks)
3 a. What arethetypes of control charts? List theformulae used in X andR charts. (03Marks)
b. What arethedifferent types of forecasting techniques? Explain. (07Marks)
c. A drugmanufacturing company hasademand for 10,00,000 bottles. Eachempty bottle costs
,thecompany Re.l. Empty bottles aresupplied by Mis. Glass Tech Ltd. TheR.O.L systemof
stock replenishment is followed. Ordering cost isRS.12.5 per order and inventory carrying
cost is 25 percent of cost per bottle. The demand is constant throughout theyear. The lead
time is 15days. Determine:
i) Economic order quantity ii) Lead-time consumption
iii) Re-order level iv) Average inventory (10Marks)
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lOMBA33
4 a. What arethestepsinvolved inmethodstudy? (03 Marks)
b. What are the different types of inventory control techniques? Explain ABC analysis with
examples andgraphrepresentation. ,~, , . . ". (07 Marks)
c. Samples of 4e h tak f' ,-d Th ment of which werenotedasfollows : ac were en or stu iy, emeasure
Sample No. Measurements inmm
1 20 22 25 24
2 18 23 20 26
3 24 25 22 20
4 23 21 26 24
5 24 25 24 21
Draw X - R chart (A2=0.73 for samplesize4) (D4 =2.28; D3=0). Plot graph. (10 Marks)
5. a. How ethics play animportant roleintoday's purchasing profession? (03 Marks)
b. How many working minutes do you expect, it would take a worker to produce apart for
which thetime standard is 10minutes, if the allowance for this work is25% of the normal
andtheworker israted at 80%? (07 Marks)
. c. A die-casting company uses amoving average to forecast next month's demand. The past
actuaI demand (inunits) is showninbelow table.
Month 43 44' 45 46 47 48 49 50 51
Actual demand 105 106 110 110 114 121 130 128 137
i) Compute asimple 5monthmoving average toforecast for month 52.
ii) Compute aweighted 3 month moving average where the weight arehighest for the
latest months and descend inorder of 3, 2, 1. (10Marks)
6 a. What arethevarious location models available?
b. Explain QFD..
c. Calculat d f h f 11
(03 Marks)
(07Marks)
even or ratmg or t e 0 owmg :
Suppler's data X Y Z
Quality supplied 100 110 120
Quality accepted 93 98 108
Priceof item(Rs.) 5
5.2
4.9
Delivery promised (inweeks) 6 6 6
Actual delivery (inweeks) '7 6.2 6.6
Weightage quality :::;70% ; price=15%; delivery =15%. ' (10 Marks)
7 a. What isPDCA?
b. What issixsigma? Explain DMAIC.
c. Discuss indetail thecost of quality.
(03 Marks)
(07 Marks)
(10Marks)
8 Write short notes on:
a. MBNQA
b. ISO 9000 : 2000
c. FQC tools
d. J uran's quality triology. (20 Marks) "
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