Lahore School of Economics

Midterm Exam Winter 2020

Operations Management

Section K

Total Marks: 45 Time Allowed: 60 Mins

Attempt all questions.

Submit your response file in PDF format only on Portal.

1. Marie Bain is the production manager at a company that manufactures hot water heaters.
Marie needs a demand forecast for the next few years to help decide whether to add new
production capacity. The company's sales history (in thousands of units) is shown in the table
below. Use exponential smoothing with trend adjustment to forecast demand for period 6.
The initial forecast for period 1 was 11 units; the initial estimate of trend was 0. The
smoothing constants are α = .3 and β = .3 (10)

Period Actual
1 12
2 15
3 16
4 16
5 18
6 20

2. A network consists of the following list. Times are given in weeks. (10)

Activity Preceding Duration

A -- 9
B A 2
C A 12
D A 5
E B 6
F B 8
G C, F 3
H D 2
I H 8
J G, I 6
K E, J 2

a. Draw the network diagram.

b. Which activities form the critical path?
c. How much slack exists at activities A and F?
d. What is the duration of the critical path?
3. Identify and explain the four basic global operations strategies. Give an example of each
strategy. You may want to take reference from "globalization of markets" and" How Netflix
expanded to 190 countries…" article to support your answer. (15)

4. A local university is considering changes to its class structure in an effort to increase

professor productivity. The old schedule had each professor teaching 5 classes per week, with
each class meeting an hour per day on Monday, Wednesday, and Friday. Each class
contained 20 students. The new schedule has each professor teaching only 3 classes, but each
class meets daily (Mon.-Fri.) for an hour. New classes contain 50 students. (10)

a. Calculate the labor productivity for the initial situation (students/hour).

b. Calculate the labor productivity for the schedule change (students/hour).
c. Are there any ethical considerations that should be accounted for?
d. Suppose that each teacher also is required to have 2 hours of Office Hours each day
he/she taught class. Is the schedule change a productivity increase?