IE 424/524 Spring 2016

IE 424/524 Spring 2016 Instructions:  Answer questions (1 through 4 if you are an IE 424 student and 1 through 5 if you are an IE 524 student).  Please show all work.  You must not discuss this exam with your classmates or other people—all work must be your own.  Any research must be properly cited.  This exam is due by 11:59 PM Mountain Time on March 30, 2016.  (That’s 12am on Thursday, 3/31).  Your late submittal will lose points starting at 12:01 am on Thursday 3/31 so plan accordingly.    

1. Due a complicated process required to set up a machine, Wizard Corporation has decided to produce a product only once a month. Demand occurs at a continuous and constant rate of 1000 units a month.  Wizard Corporation also keeps 50 units available just in case production is delayed.  Plot the level of cycle inventory and safety stock over the month.  What is their average inventory level? Why?

 

2. The Sohn Aerospace Division of Sohnco has a forecast for the first three months of next year is

January         100 ships February        0 ships March             300 ships   Strangely, they have 100 ships in stock as of December 31.  

1. a) Plot cumulative demand and a level aggregate production plan with no back orders and no ending inventory.
2. b) What production is needed each month to meet part a’s conditions?

         

4. Valles Global Industries hires special vans to transport visitors to their secret lab in Durango, CO. They have the following data:

  Year                Sightseers 2013               60,109 2014               64,305 2015               59,935 2016               62,795 2017               62,673 2018               66,675 2019               67,937 2020               71,967 2021               74,683 2022               73,349  

1. Plot these data, develop a hypothesis of an appropriate model, estimate the model’s parameters, and forecast passengers for 2023-2025.
2. Illustrate an exponential smoothing model using an alpha of .1 and then an alpha of .5.

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