Dec - 2006

Paper 13 Operations and Project Management & Control December 2006 Time Allowed : 3 Hours

F-13(OPM) Revised Syllabus Full Marks : 100

The figures in the margin on the right side indicate full marks Answer Question No. 1 & Question No. 7, which are compulsory and any two other questions from Section I and any two other from Section II. Please answer all the bits of a question at one place. Section I Marks 1. (a) Explain the following acronyms: 1x5 (i) WAN (ii) TPM (iii) MOU (iv) FMS (v) 5 - S (b) Match each item in the left hand column with an appropriate item in the 1x5 right hand column: Column I Column II (A) Degreasing (1) Zinc Planting (B) Cemented Carbides (2) Metal Forming (C) Reaming (3) Matching (D) Galvanizing (4) Powdered Metallurgy (E) Drop Forging (5) Surface Treatment (c) Choose the correct answer from the alternatives given and indicate your 1x5 answer as (a) or (b) or (c) or (d). (i) SIMO Chart is used in Work Method Quality Downtime (a) (b) (c) (d) Measurement Study Control Analysis (ii) EOQ formula does not consider Storage Ordering Stock out Annual (a) (b) (c) (d) cost cost cost requirement (iii) ISO 9001 will be adopted by organizations (a) Having design and development activities (b) Manufacturing (c) Both design, development and manufacturing (d) Environmental pollution control activities. (iv) Jigs are used in machine tool for holding (a) Tools (b) Work piece (c) Head stock (d) Tail stock (v) Buffer stock is built to cater for

(a)

Fluctuating Machine (b) load breakdown

(c)

Import (d) Diversification substitution

Please turn over (2) F-13(OPM) Marks Revised syllabus (d) Find out whether the following statements are True or False: 1x5 (i) Casting are produced in Spinning Mills. (ii) Factor Comparison is a method of Job Evaluation. Linear Programming is a technique used for determining Factory (iii) Layout. (iv) Teeth of a Gear Wheel cannot be formed on a Milling Machine. (v) MRP is a marketing technique. 2. (a) Which material handling equipment are used in handling 1x5 (i) Coal in a Thermal Power Plant; (ii) Molten Steel in a Steel Plant; For transporting finished components in packed boxes from shops to (iii) stockyards; (iv) Light Steel Sheets in a Shop; (v) Grading Moulding Sand in a Foundry. (b) The packing section in a detergent factory operates under the guaranteed 4+2+4 piece rate system of wage payment. The piece rate per cake packed is 25 paise. The guaranteed wage per day (of 480 minutes) is Rs. 40/On a typical day, the number of cakes packed by each of the four workers P, Q, R & S in the packing department is as follows: P-400; Q-300; R-189 and S-150 (i) What are the earnings of each worker on this day? (ii) What is the average labour cost of packing on this day (iii) What is the labour productivity of each worker if the standard time for packing each cake in one minute? 3. (a) What are the important factors considered in deciding dispatching rules in 3 case of job shop scheduling? (b) A company is engaged in drilling and tapping of spark plugs for supply to 12 an automobile co. The operations are performed on a CNC 3-Axis drilling and tapping center. The CNC Cycle time is as follows: Drilling time : 45 seconds Total tapping time : 1 minute 30 seconds, ATC tool changing time : 25 seconds.

For feeding the spark plugs the company designed a special fixtures holding 10 plugs at a time and set up time by the operator for the 10 plugs is 1 minute 20 seconds. The machine cycle time shown above includes the movement time of each spark plug also. The company has decided to augment capacity due to an additional order from the automobile co. to the extent of 1.10 lakhs spark plugs per year. Assuming that manpower is no constraint, how many additional drilling of 1.10 lakhs spark plugs per year. Assuming that manpower is no constraint, how many additional drilling tapping centers the company should procure under the Augmentation Plan? Average rejection % 2% of the producing spark plug in drilling-tapping centers. Assume 300 working days/year of 8 hrs. per day. Please note that 20% time the drilling and tapping centers are not available due to preventive maintenance and the utilization is 70% of the available time due to power and service line shut downs.

Please turn over (3)

F-13(OPM) Revised syllabus Marks 4. (a) State the measures normally used for defining capacity in the following 1x5 product/services: SI. No Product/Service Measures of capacity (i) Steel Plant (ii) Automobiles (iii) Power Plant (iv) Hospital (v) Hotel (b) List several ways that a firm can respond to meet seasonal demand 6 patterns. (c) A firm must produce 40 units/day during an 8-hour work day. Tasks, 2+3 time and predecessors are given below: Task time (Minutes) Predecessors(s) A 2 — B 2 A C 8 — D 6 C

E F G H

3 10 4 3

B D, E F G

Find out (i) the cycle time, (ii) No. of theoritical work stations. 5. (a) What are the various techniques of job-evaluation? Briefly describe any 2+4+4 two techniques of job-evaluation. (b) A company is manufacturing precision standard components for 5 automobile industry. The rejection percentage being high, the productivity level is low and the piece-workers find it very difficult to earn any profit beyond the minimum guaranteed wages. As Operation Manager, what will be your suggestions to improve productivity? 6. Write short notes on the following: 3+5+3+4 (a) Process Layout; (b) Learning Curve; (c) Heat Treatment; (d) Resistance to Change. Section II 7. (a) Expand the following acronyms: 1x5 (i) VCF (ii) LCC (iii) BMRED (iv) ECB (v) IRR. (b) Match the following 1x5 (A) Deferred Credit (1) Zero Float (B) Milestone (2) Project Activity (C) Capital Ratio (3) Investment & Turn Over (D) Resource Allocation (4) Machinery & Equipment (E) Critical Activity (5) Project Event

Please turn over (4) F-13(OPM) Revised syllabus (c) Choose the correct answer from the alternatives given: (i) Taxonomy of a Project means: (a) Tax Incentive (b) Project Quality (c) Project Classification (d) Economy (ii) BEP denotes:

Marks 1x5

(a) A type of contract (b) Project Implementation (c) Project Feasibility (d) Project Organization. (iii) Bilateral Aid means: (a) Government (of country) to Government (of another country) air (b) Aid from stake holders of the company (c) Aid from financial institutions (d) Financing against hypothecation of fixed assets. (iv) SWOT is: (a) Networking (b) Organizational Analysis (c) Bank Financing (d) None of the above. (v) Commercial Paper means: (a) News Paper (b) Application for loan (c) Capital Rationing (d) A method of obtaining Working Capital. (d) State whether the following statements are True or False: 1x5 (i) Normal costs are estimates of direct costs of a Project to be performed in normal time. (ii) Capital Rationing is spreading funds to all the Projects when total funds available are insufficient. (iii) Royalty is the consideration paid to the collaborator annually for transfer of technical know-how over the duration of the agreement. (iv) Head slack is the difference between the Earliest and Latest Occurrence times of the Tail Event of an activity. Benefit Cost Ratio is the ratio of present value of Benefits to the present (v) value of investment. 8. (a) Explain briefly the various methods of forecasting the Market Demand. 10 (b) What are the marits and demerits of the Econometric Method of Demand 3 Forecasting? (c) Khushboo Cosmetics have Talcum Powder as their main product. Its price was 2 Rs. 40/- per tin which was incurred to Rs. 45/- in the subsequent year. As a result, the sales have gone down from 90,000 to 85,000 tins per year. What is the Price Elasticity of Demand for this product?

Please turn over (5)

F-13(OPM) Revised syllabus Marks 9. (a) Discuss the principles sources of discrepancy between Social Cost Benefit 2 Analysis and Monetary Cost Benefit Analysis. (b) What is "Gestation Period" of a project? How it is important in project 4 financing decisions? (c) What is DPR? What are the important items to be covered in a DPR> 1+3 (d) What is IRR? Why is it considered in selection of projects? 1+2 10. (a) The following data pertains to the "INTEL" Project: Activity Normal Crash time Normal cost Crash cost time (Weeks) (Rs.) (Rs.) (Weeks) 0-1 1 1 5,000 5,000 1-2 3 2 5,000 12,000 1-3 7 4 11,000 17,000 2-3 5 3 10,000 12,000 2-4 8 6 8,500 12,500 3-4 4 2 8,500 16,500 4-5 1 1 5,000 5,000 1+1+8 (i) What is the normal cost and duration of the project? (ii) Crash the project till it can not be crashed further and compute the extra cost involved with each crashing. (b) What is Lease Financing? What are its merits and demerits with reference 2+2 to Project + Financing? 11. (a) An investment corporation wants to study the investment projects based 11 on three factors; market demand in units, price per unit minus cost per unit and investment required. These factors are felt to be independent of each other. In analyzing a new consumer product, the corporation estimates the following probability distributions. Annual Demand Price minus cost Investment required Units Probabilit Rs. Probability Rs. Probability y 20,00 0.05 3.00 0.10 17,50,000 0.25 0 0.10 5.00 0.20 20,00,000 0.50 25,00 0.20 7.00 0.40 25,00,000 0.25 0 0.30 9.00 0.20 30,00 0.20 10.00 0.10 0 0.10 35,00 0.05 0 40,00 0

45,00 0 50,00 0 Using the Monte Carlo Simulation, determine the return on investment on the basis of 10 trials and using the following ten random numbers. 82, 84, 28, 82, 36, 92, 73, 91, 63, 29. (b) The CST of two quotations received for a particular project item is as 4 follows: Quotation No. 1 Quotation No. 2 Technical suitability : Technically Accepted Technically Accepted Basic Price : Rs. 1000 per unit Rs. 1160 per unit Freight charges and : Rs. 50 per unit Rs. 75 per unit packing cost : At actuals and subject Included in basic price Taxes & Duties to future increase and quoted price is firm and fixed. The present rate of statutory taxes and duties on the item is 16% of basic price. As a Project Manager which firm you will select? Justify. 12. Write short notes on the following: 4+3+3+ 5 (a) Matrix Organisation Structure; (b) Turn-key Project. (c) Inter-Corporate loans. (d) Project Rating Index. __________