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MGMT 1050 Quiz: stats book summary notes pt4Premium

6 pages44 viewsFall 2014

Department
Management
Course Code
MGMT 1050
Professor
Olga Kraminer
Study Guide
Quiz

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Chapter 13 Project Scheduling: PERT/CPM
showed how PERT/CPM can be used to plan, schedule, and control a wide variety
of projects. The key to this approach to project scheduling is the development of
a PERT/CPM project network that depicts the activities and their precedence
relation- ships. From this project network and activity time estimates, the critical
path for the net- work and the associated critical activities can be identified. In
the process, an activity schedule showing the earliest start and earliest finish
times, the latest start and latest finish times, and the slack for each activity can be
identified.
We showed how we can include capabilities for handling variable or uncertain
activity times and how to use this information to provide a probability statement
about the chances the project can be completed in a specified period of time. We
introduced crashing as a procedure for reducing activity times to meet project
completion deadlines, and we showed how a linear programming model can be
used to determine the crashing decisions that will minimize the cost of reducing
the project completion time.
Chapter 14 Inventory Models
presented some of the approaches used to assist managers in establish- ing low-
cost inventory policies. We first considered cases in which the demand rate for
the product is constant. In analyzing these inventory systems, total cost models
were developed, which included ordering costs, holding costs, and, in some cases,
backorder costs. Then minimum cost formulas for the order quantity Q were
presented. A reorder point r can be established by considering the lead-time
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demand.
In addition, we discussed inventory models in which a deterministic and
constant rate could not be assumed, and thus demand was described by a
probability distribution. A critical issue with these probabilistic inventory
models is obtaining a probability distribution that most realistically
approximates the demand distribution. We first described a single-period model
where only one order is placed for the product and, at the end of the period,
either the product has sold out or a surplus remains of unsold products that will
be sold for a salvage value. Solution procedures were then presented for
multiperiod models based on either an order-quantity, reorder point, continuous
review system or a replenishment-level, periodic review system.
In closing this chapter, we reemphasize that inventory and inventory systems
can be an expensive phase of a firm’s operation. It is important for managers to
be aware of the cost of inventory systems and to make the best possible
operating policy decisions for the inventory system. Inventory models, as
presented in this chapter, can help managers to develop good inventory policies.
The Q.M. in Action, Multistage Inventory Planning at Deere & Company, provides
another example of how computer-based inventory models can be used to
provide optimal inventory policies and cost reductions.
Chapter 15 Waiting Line Models
presented a variety of waiting line models that have been developed to help
managers make better decisions concerning the operation of waiting lines. For
each model we presented formulas that could be used to develop operating
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