pLEASE MAKE SURE TO SHOW YOUR WORK FOR EACH QUESTION.
QUESTION 1
Darren
is operations manager of a company producing Christmas decorations. As a
result, he is concerned about making enough of the decorations in time to get
them in the time for the everearlier Christmas season. He has just been
given the following production report. His necessary monthly
average productivity is 12 units per machine hour. Has he met that
average each month? Calculate each monthly average to show me your
rationale for your answer.

Jan 
Feb 
March 
April 
Units
produced 
3600 
4500 
5700 
7200 
Hours
per machine 
120 
120 
120 
120 
Number
of machines 
3 
3 
4 
6 
QUESTION 2
Carmen sells customized gingerbread
houses. She has sold the following number over the past 8 years.
Calculate the models for the time period shown and generate a forecast
for 2017. Which of the models (Moving average, weighted moving average (she’s
using 311) or exponential smoothing) would best predict how many she
should produce next year? Hint: show me all of the models.
Use alpha=.2. and presume, for purposes of the Exponential Smoothing Forecast,
that the prior model had forecast 180 units in 2009.
2009 180
2010 210
2011 195
2012 220
2013 250
2014 280
2015 230
2016 275
QUESTION 3
Clarence is thinking of creating a
bakery specializing in gingerbread cookies. He has three options: a
face to face bakery where customers can come in and customize their
gingerbread, a kiosk where the gingerbread is already decorated but customers
can choose the color and style of decoration or internet only, where customers
can specify which shape they want, but the decoration color and style cannot be
requested. The cost of the face to face bakery would be $15,000 for the
two months between Halloween and New Years, and has a 50% chance of generating
$16000 in income and a 50% chance of generating $10000 in income.
The kiosk would be $3000 per month for the two months, and has a 50% chance of generating
$8000 in income, and a 50% chance of generating $5000 in income. The
internet option would cost only $5000 for the two months, and has a 50% chance
of generating an income of $10000 and a 50% chance of generating a $8000
income. Which one has the highest profit potential? Show your
calculations.
QUESTION 4
Carmen’s gingerbread houses have the
following process times. Construct a critical path diagram to show the
process and determine how long each house will take and identify the critical
path and amount of slack on the other paths.

Time 
Predecessor 
A.
Assemble ingredients 
5 min 
 
B.
Bake gingerbread 
30 min 
A 
C.
Cool gingerbread 
45 min 
B 
D.
Make icing 
10 min 
A 
E.
Build house 
30 min 
C, D 
F.
Let house assembly cure 
45 min 
E 
G.
Assemble decorations 
5 min 
 
H.
Decorate house 
50 min 
D, F, G 
QUESTION 5
Using
the critical path diagram from the prior problem, what is the theoretical
minimum number of stations required to meet a forecast demand of 150 units per
month? Create a line balance chart for the process as well.
QUESTION 6
Carmen’s fruitcakes must be
baked, must be drowned in brandy and sit for four weeks before being drowned
again in brandy a second time before it is sold. Each fruitcake requires
a cup of brandy for each marination. If brandy comes in gallon jugs, what
is the economic order quantity if Carmen sells 233 fruitcakes every 4
weeks? The cakes sell for $40 each, and have a holding cost of 2% per 4
weeks. Setup costs are $30 per batch. Answer in whole units and show
your calculations.
QUESTION 7
Petra’s
custom ornaments personalizes ornaments on the spot. She has a small
kiosk at the mall, where customers walk up, select the ornament and specify the
personalization. Petra can have up to three employees. An
inexperienced employee takes 5 minutes to personalize each ornament is paid
$12/hour and works 6 hour days each. She can hire an experienced
personalizer who can produce the personalization in 2 minutes per ornament for
$18/hour for a 6 hour day. If she has a request for 40 ornaments to be
personalized each hour, calculate a) waiting time for each ornament,
using the various combinations of employees, and b) identify what option gives
the best utilization of employee time.
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