MUZZAMIL HUSSAIN WANI Student Number: - 3636788

ADM 4615 & MBA 6623

Homework #1 – Project Management Problem Due Date: September 24, Monday in class

QUESTION 1:

A project consists of seven activities. The precedence relationships are given in the following table.

Activity Time Immediate

(days) Predecessors
A 32
B 21
C 30
D 45 A
E 26 A, B
F 28 C
G 20 E, F

a. Construct a network for this project.

b. Compute the earliest and the latest starting and finishing times for each activity and identify the critical
path.

ANSWER 1:

The network for the given Project is as follows:-

A D

START B E G END

C F

Following are the Earliest Starting and Earliest Finishing times:-

For A = [0,32] For B = [0,21] For C = [0,30] For D = [32,77]

For E = [32,58] For F = [30,58] For G = [58,78]

1
Following are the Latest Starting and Latest Finishing times:-

For G = [58,78] For E = [32,58] For F = [30,58] For C = [0,30]

For B = [0,21] For D = [32,77] For A = [0,32]

Following table shows the earliest start, earliest finish, latest start, latest finish and slack calculations

Activity Time Early Start Early Finish Latest Start Latest Slack
Finish
A 32 0 32 0 32 0
B 21 0 21 11 32 11
C 30 0 30 0 30 0
D 45 32 77 33 78 1
E 26 32 58 32 58 0
F 28 30 58 3 58 0
G 20 58 78 58 78 0

Since, Slack time in B and D are not zero, they cannot be a part of Critical Path. Therefore, the Paths left
are :-

A – E – G = 32 + 26 + 20 = 78 days.

C – F – G = 30 + 28 + 20 = 78 days.

Thus, we have Multiple Critical Paths. ANS

QUESTION 2:

Consider Question 1. Suppose that the normal and the expedited costs and times are as given in the
following table.

Activity Normal Expedited Normal Expedited

Time Time Cost Cost
A 32 26 $ 200 $ 500
B 21 20 300 375
C 30 30 200 200
D 45 40 500 800
E 26 20 700 1,360
F 28 24 1,000 1,160
G 20 18 400 550

If indirect costs amount to $100 per day, determine the optimal time to complete the project and the
optimal project completion cost.

2
ANSWER 2:

As seen from Question 1, the various paths for the project are:-

A – D = 32 + 45 = 77 days

A – E – G = 32 + 26 + 20 = 78 days.

C – F – G = 30 + 28 + 20 = 78 days.

B – E – G = 21 + 26 + 20 = 67 days.

Amongst these paths, the critical paths are A – E – G and C – F – G and the Project time period is 78 days.

The cost to reduce per day for each activities are given as follows:-

Critical Normal Expedited Normal Cost Expedited Cost to Normal

Activities Time Time Cost reduce per Time –
day Expedited
Time
A 32 26 200 500 (500- 6
200)/(32-
26)= 50
C 30 30 200 200 (200- 0
200)/(30-
30)= 0/0
E 26 20 700 1360 (1360- 6
700)/(26-
20)= 110
F 28 24 1000 1160 (1160- 4
1000)/(28-
24)= 40
G 20 18 400 550 (550- 2
400)/(20-
18)= 75

As G is the common activity in both critical paths, therefore reducing G by 1 day, and the direct cost
incurred from it will be $75. Therefore the paths are:-

A – D = 77 days. A – E – G = 77 days. B – E – G = 66 days. C – F – G = 77 days.

Thus, we get 3 critical paths that have 77 days of project time.

After reducing G by 1 day, we have the Direct cost = 3300 + 75 = $ 3375.

Again, reducing G by 1 day, we get

A – D = 77 days. A – E – G = 76 days. B – E – G = 65 days. C – F – G = 76 days.

Thus, A-D becomes new critical path, and direct cost now becomes 3375 + 75 = $3450.

3
Now, reducing activity A by 1 day (as D can’t be reduced);

A – D = 76 days. A – E – G = 75 days. B – E – G = 65 days. C – F – G = 76 days.

Therefore, 2 new critical paths are incurred and the total direct cost becomes 3450 + 50 = $3500.

Again, reducing activity A by 1 day, we have:

A – D = 75 days. A – E – G = 74 days. B – E – G = 65 days. C – F – G = 76 days.

Therefore, new critical path becomes C – F – G and Project Time is 76 days. Total Direct Cost is $3550.

Now, reducing Activity F by 1 day, (as G can’t be reduced further and C cannot be reduced at all):

A – D = 75 days. A – E – G = 74 days. B – E – G = 65 days. C – F – G = 75 days.

Now, total direct cost is 3550 + 40 = $3590.

2 new critical paths are obtained. Reducing F by 1 day, as it has least cost of reduction. New paths are:

A – D = 75 days. A – E – G = 74 days. B – E – G = 65 days. C – F – G = 74 days.

New critical path is A – D and project time is 75 days. Total direct cost becomes $3630.

Again reducing Activity A by 1 day we get:

A – D = 74 days. A – E – G = 73 days. B – E – G = 65 days. C – F – G = 74 days.

Thus, new project time is 74 days and new project direct cost is 3630 + 50= $3680.

QUESTION 3:

A project consisting of eight activities satisfies the following precedence constraints:

Activity Time Immediate

(weeks) Predecessors
A 3
B 5 A
C 1 A
D 4 B, C
E 3 B
F 3 E, D
G 2 F
H 4 E, D

a. Construct a network for this project. (You should need only on pseudo activity.)

4
b. Compute the earliest and the latest starting and finishing times for each activity and identify the critical
path.

ANSWER 3:

Following is the network for the given Project:-

A B E H

END

C D F G

Following are the earliest starting and Earliest Finishing times for the given network:

For A = [0,3] For B = [3,8] For C = [3,4] For D = [8,12]

For E = [8,11] For F = [12,15] For G = [15,17] For H = [12,16]

Following are the Latest Starting and Latest Finishing times:-

For H = [12,16] For G = [15,17] For E = [9,12] For F = [12,15] For B = [3,8]

For D = [8,12] For C = [7,8] For A = [0,3]

Following table shows the earliest start, earliest finish, latest start, latest finish and slack calculations

Activity Time Early Start Early Finish Latest Start Latest

Finish
A 3 0 3 0 3
B 5 3 8 3 8
C 1 3 4 7 8
D 4 8 12 8 12
E 3 8 11 9 12
F 3 12 15 12 15
G 2 15 17 15 17
H 4 12 16 12 16

Since the Earliest start, earliest finish of Activity C and Activity E do not match the Latest start and latest
finish, they cannot be the part of the critical path.

Hence, we have two paths:-

A – B – D – F – G = 3 + 5 + 4 + 3 + 2 = 17.

5
A – B – D – H = 3 + 5 + 4 + 4 = 16.

Therefore, A – B – D – F – G is critical path and the critical time is 17 weeks.

QUESTION 4:

Consider the project described in Question 3 with the normal and the expedited costs and times given in
the following table.

Activity Immediate Normal Expedited Normal Expedited

Predecessor Time Time Cost Cost
A - 3 2 $ 200 $ 250
B A 5 3 600 850
C A 1 1 100 100
D B, C 4 2 650 900
E B 3 2 450 500
F E, D 3 2 500 620
G F 2 1 500 600
H E, D 4 2 600 900

a. Consider successive reductions in the project time of one week and find the direct cost of the project
after each reduction.

b. Suppose that indirect costs are $150 per week. Find the optimal project completion time and the
optimal total project cost.

ANSWER 4:

The various paths from Question 3 are:-

A – B – D – F – G = 17

A – B – E – F – G = 16

A – B – D – H = 16

A – B – E – H = 15

A – C – D – F – G = 13

A – C – D – H = 12

Therefore, A – B – D – F – G is critical path and the Project time is 17 weeks.

6
The cost to reduce per day for each activities are given as follows:-

Critical Normal Expedited Normal Cost Expedited Cost to Normal

Activities Time Time Cost reduce per Time –
week Expedited
Time
A 3 2 200 250 (250 - 1
200)/(3 – 2)
= 50
B 5 3 600 850 (850 – 2
600)/(5 – 3)
= 125
D 4 2 650 900 (900 – 2
650)/(4 – 2)
= 125
F 3 2 500 620 (620 – 1
500)/(3 -2) =
120
G 2 1 500 600 (600 – 1
500)/(2 – 1)
= 100
Total Direct
Cost =
$2450

Reducing Activity A by 1 week, we get:-

A – B – D – F – G = 16 A – B – E – F – G = 15 A – B – D – H = 15

A – B – E – H = 14 A – C – D – F – G = 12 A – C – D – H = 11

Thus critical path remains A – B – D – F – G with Project time of 16 weeks. Project Direct Cost is 2450 + 50
= $2500.

Now reducing G by 1 week (since A cannot be reduced further), we get:-

A – B – D – F – G = 15 A – B – E – F – G = 14 A – B – D – H = 15

A – B – E – H = 14 A – C – D – F – G = 11 A – C – D – H = 11

2 new critical paths are obtained with project time 15 weeks. Total Direct Cost is 2500 + 100 = $2600.

Reducing D by 1 week, as it is common in both the paths, we get:-

A – B – D – F – G = 14 A – B – E – F – G = 14 A – B – D – H = 14

A – B – E – H = 14 A – C – D – F – G = 10 A – C – D – H = 10

7
4 new critical paths are obtained with project time 14 weeks. Total Direct Cost is 2600 + 125 = $2725.

Reducing B by 1 week, as it is common in all the paths, we get:-

A – B – D – F – G = 13 A – B – E – F – G = 13 A – B – D – H = 13

A – B – E – H = 13 A – C – D – F – G = 10 A – C – D – H = 10

New Direct Cost is 2725 + 125 = $2850. Again reducing B by 1 week (since its common in all critical paths):-

A – B – D – F – G = 12 A – B – E – F – G = 12 A – B – D – H = 12

A – B – E – H = 12 A – C – D – F – G = 10 A – C – D – H = 10

Direct Cost becomes 2850 + 125 = $2975. Since B cannot be reduced further, reducing F by 1 week as it
has lesser reduction cost than D, we get:-

A – B – D – F – G = 11 A – B – E – F – G = 11 A – B – D – H = 12

A – B – E – H = 12 A–C–D–F–G=9 A – C – D – H = 10

2 critical paths are obtained as A – B – D – H and A – B – E – H with project time as 12 weeks. Direct Cost
becomes 2975 + 120 = $3095.

Reducing D by 1 week as it’s the only activity that can be reduced now.

A – B – D – F – G = 10 A – B – E – F – G = 11 A – B – D – H = 11

A – B – E – H = 12 A–C–D–F–G=8 A–C–D–H=9

Thus Critical Path is A – B – E – H = 12 weeks. Total Direct Cost is 3095 + 125. = $3220.

All the activities are reduced to their maximum and thus Optimal Project Time is 12 Weeks.

The total indirect cost = 150 * 12 = $1800.

Therefore, Optimal Total Project Cost = 3220 + 1800 = $5020. ANS.

QUESTION 5:

Consider the following PERT time estimates:

Activity Immediate a m b
Predecessors
A - 2 5 9
B A 1 6 8
C A 3 5 12
D B 2 4 12
E B, C 4 6 8
F B 6 7 8
G D, E 1 2 6
H F, G 4 6 16

8
a. Draw a network for this project and determine the critical path based on the most likely times by
inspection.

b. Assuming that the critical path is the one you identified in part (a), what is the probability that the
project will be completed before 28 weeks? Before 32 weeks?

c. Assuming that the critical path is the one you identified in part (a), how many weeks are required to
complete the project with probability .95?

ANSWER 5:

The mean time for each activity is calculated by the following formula:-

µ = (a + 4m + b)/6

Therefore, for Activity A, µ = (2 + 4(5) + 9)/6 = 5.16

For Activity B, µ = (1+ 4(6) + 8)/6 = 5.5

For Activity C, µ = (3 + 4(5) + 12)/6 = 5.83

For Activity D, µ = (2 + 4(4) + 12)/6 = 5

For Activity E, µ = (4 + 4(6) + 8)/6 = 6

For Activity F, µ = (6 + 4(7) + 8)/6 = 7

For Activity G, µ = (1 + 4(2) + 6)/6 = 2.5

For Activity H, µ = (4 + 4(6) + 16)/6 = 7.33

Now, Variance for each activity is calculated by the following formula:-

σ2 = (b – a)2 /36

Therefore, for Activity A, σ2 = (9 – 2)2 /36. σ = 1.36

For Activity B, σ2 = (8 – 1)2/36. σ = 1.36

For Activity C, σ2 = (12 – 3)2/36. σ = 2.25

For Activity D, σ2 = (12 – 3)2/36. σ = 2.77

For Activity E, σ2 = (8 – 4)2/36. σ = 0.44

For Activity F, σ2 = (8 – 6)2/36. σ = 0.11

For Activity G, σ2 = (6 – 1)2/36. σ = 0.69

For Activity H, σ2 = (16 – 4)2/36. σ = 4

The following table shows the Mean Time and Variances on each Activity:-

9
 Activity Min(a) Most Likely(m) Max(b) Mean Time Variance
A 2 5 9 5.16 1.36
B 1 6 8 5.5 1.36
C 3 5 12 5.83 2.25
D 2 4 12 5 2.77
E 4 6 8 6 0.44
F 6 7 8 7 0.11
G 1 2 6 2.5 0.69
H 4 6 16 7.33 4

The Network for the given Problem is as follows:-

F H

A B D G

C E

From the Network, we can see the various paths and their Project times as follows:-

 A – C – E – G – H = 5 + 5 + 6 + 2 + 6 = 24.
 A – B – D – G – H = 5 + 6 + 4 + 2 + 6 = 23.
 A – B – E – G – H = 5 + 6 + 6 + 2 + 6 = 25.
 A – B – F – H = 5 + 6 + 7 + 6 = 24.

Thus, based on the most likely times (m) by inspection, we have the Critical Path as A – B – E – G – H, with
Project time equal to 25 weeks. ANS (a)

The Variance of activities as obtained from the critical path is as follows:-

Variance = 1.36 + 1.36 + 0.44 + 0.69 + 4

10
 = 7.85

Also, the Standard Deviation = √𝑣𝑎𝑟𝑖𝑎𝑛𝑐𝑒

= √7.85

Therefore, σ = 2.8

Also, the mean time for the critical path network is 25 weeks.

Now, the probability that the project will be completed before 28 weeks is as follows:-

P (T < 28) = P {(T - µ)/σ < (28 – 25)/2.8}

= P {Z < 1.07}

From the table of probability distribution, we have

P (T < 28) = 0.85. ANS (b)

Similarly, the probability that the project will be completed before 32 weeks is as follows:-

P (T < 32) = P {(T - µ)/σ < (32 – 25)/2.8}

= P {Z < 2.5}

From the table of probability distribution, we have

P (T < 32) = 0.99. ANS (b)

To find out the number of weeks (t) required to complete the project with probability 0.95, the value of
Z0.95 from the normal probability distribution table is 1.65.

Thus, 0.95 = P {Z < (t-µ)/σ}

Which implies,

(t-µ)/σ = Z0.95

t= µ +σ (Z0.95)

t= 25 + 2.8 (1.65)

t= 29.62 weeks ANS(C)

11