0% found this document useful (0 votes)
26 views24 pages

Simulation

The document outlines a simulation exercise involving demand forecasting for confectionery items, raw material usage for detergent production, and financial projections for a small retailer and a businessman considering a new venture. It includes the use of random numbers to generate simulated demand and financial outcomes based on historical data and probability distributions. The results include average demands, estimated balances, and net revenues derived from the simulations.
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
0% found this document useful (0 votes)
26 views24 pages

Simulation

The document outlines a simulation exercise involving demand forecasting for confectionery items, raw material usage for detergent production, and financial projections for a small retailer and a businessman considering a new venture. It includes the use of random numbers to generate simulated demand and financial outcomes based on historical data and probability distributions. The results include average demands, estimated balances, and net revenues derived from the simulations.
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Simulation

Simulation

Ex. Book No. Pg. No.


1
A confectioner sells confectionery items. Past data of demand per week in hundred kilograms
with frequency is given below:
Demand/Week 0 5 10 15 20 25
Frequency 2 11 8 21 5 3
Using the following sequence of random numbers, generate the demand for the next 10
weeks. Also find out the average demand per week.
Random numbers 35 52 13 90 23 73 34 57
35 83 94 56 67 66 60

Reference What’s New


Average Demand Frequency

Answer
Table - I
Random No. Range Table for demand
Demandper Probability Cumulative Range†
Frequency(f)
week (p = f ÷ ∑f) Probability of Random Nos.
0 2 .04 .04 00-03
5 11 .22 .26 04-25
10 8 .16 .42 26-41
15 21 .42 .84 42-83
20 5 .10 .94 84-93
25 3 .06 1.00 94-99
∑ f = 50 1.00
As the given Random Nos. are of 2 digits, the ranges of Random Nos. has also been considered
to have 2 digits only. Also the range of Random Nos. corresponds to cumulative probability
values which lies between 0 & 1 and can be correlated as nos. between 00 and 99.

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 79
Simulation

Table - II
Simulated Values for next 10 weeks
Weeks Random Nos. Demand
1 35* 10*
2 52 15
3 13 5
4 90 20
5 23 5
6 73 15
7 34 10
8 57 15
9 35 10
10 83 15
Total – 120
*From Table (I), Random No. 35 appears in the range of 26-41. Also the demand for this range
is 10.
Average weekly demand = 120 = 12
10
Ex. Book No. Pg. No.
2
Using empirical data A process planner is working on plans for producing a new detergent. She
wishes to simulate a raw material demand in order to plan for adequate materials – handing
and storage facilities. On the basis of usage for a similar product introduced previously, she
has developed a frequency distribution of demand in tons per day for a 2-month period. Use
this data (shown below) to simulate the raw material usage requirements for 7 periods (days)
and average demand.
Demands, X (tons/ day) 10 11 12 13 14 15
Total = 60
Frequency (days) 6 18 15 12 6 3
Use following Random No. 27, 13, 80, 10, 54, 60, 49
Reference What’s New
Raw Material Usage Required and
Average Demand

Website: [Link] / Contact: 033 4059 3800


80 |CMA Inter
Operations Management & Strategic Management
Simulation

Answer
(1) Data are given in frequencies.
(2) To formulate a probability distribution, divide each frequency by the total (60), for
example, 6 60 = .10 and18 60 = .30. Then formulate a cumulative probability distribution
by successively summing the probabilityvalues.
Demand Frequency Probability Cumulative
(tons/day) (days) P(X) probability
10 6 0.10 0.10
11 18 0.30 (10 + 0.30) = 0.40
12 15 0.25 0.65
13 12 0.20 0.85
14 6 0.10 0.95
15 3 0.05 1.00
1.00 60 1.00

(3) Next, assign random – number intervals so that the number of values available to each
class corresponds with the probability. Using 100 two – digit numbers (00-99), we assign
10 percent (00-09) to the first class,30 percent (10-39) to the second class, and so on.
Demand Probability Corresponding
(tons/day) P(X) Random Numbers
10 .10 00-09
11 .30 10-39
12 .25 40-64
13 .20 64-84
14 .10 85-94
15 .05 95-99
1.00 RN = 27
(4) We obtained random numbers (RN) from column 1 of Appendix I (for convenience),
so the first seven numbers are:
27 13 80 10 54 60 49
The first RN, 27, falls into the second class of the distribution and corresponds to a
demand of 11 tons per day.
Random Number 27 13 80 10 54 60 49
Simulated Demand 11 11 13 11 12 12 12

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 81
Simulation

(5) This extremely small simulation yields a mean of X = 11.7 tons. The expected value from
the empirical probability distribution is E(X) = [XP(X)] = 12.05 tons, suggestion that the
small sample size of only 7 periods has resulted in some error. A much larger sample
should be simulated before the simulation results are used for making decisions.
Note that the width of the random number “target” in each class corresponds exactly to
the relative frequency of the class. This helps to ensure that the simulated results have
the same type of distribution as the original data. This is more apparent in the graphic
method where the vertical distances on the graph correspond to the relative frequencies
of the respective classes.

Ex. Book No. Pg. No.


3
A Small retailer has studied the weekly receipts and payments over the past 200 weeks and
has developed the following set of information:
Weekly Receipts (`) Probability Weekly Payments (`) Probability
3000 0.20 4000 0.30
5000 0.30 6000 0.40
7000 0.40 8000 0.20
12000 0.10 10000 0.10

Using the following set of random numbers, simulate the weekly pattern of receipts and
payments for the 12 weeks of the next quarter, assuming further that the beginning bank
balance is ` 8000. What is the estimated balance at the end of the 12 weekly period? What is
the highest weekly balance during the quarter? What is the average weekly balance for the
quarter?
Random Numbers
For Receipts 03 91 38 55 17 46 32 43 69 72 24 22
For payments 61 96 30 32 03 88 48 28 88 18 71 99
According to the given information, the random number interval is assigned to both the
receipts and the payments.
Reference What’s New
Receipts and Payments

Website: [Link] / Contact: 033 4059 3800


82 |CMA Inter
Operations Management & Strategic Management
Simulation

Answer
Range of random numbers
Receipt Cumulative Payments Cumulative
Probability Range Probability Range
(`) probability (`) probability
3000 0.20 0.20 00-19 4000 0.30 0.30 00-29
5000 0.30 0.50 20-49 6000 0.40 0.70 30-69
7000 0.40 0.90 50-89 8000 0.20 0.90 70-89
12000 0.10 1.00 90-99 10000 0.10 1.00 90-99

Simulation of Data for a period of 12 weeks


Expected Expected
Random No. Random No. for
Week Receipt Payment Week end Balance(`)
for receipt payment
(`) (`)
Opening Balance 8000
1 03 3000 61 6000 5000
(8000 + 3000 – 6000)
2 91 12000 96 10000 7000
3 38 5000 30 6000 6000
4 55 7000 32 6000 7000
5 17 3000 03 4000 6000
6 46 5000 88 8000 3000
7 32 5000 48 6000 2000
8 43 5000 28 4000 3000
9 69 7000 88 8000 2000
10 72 7000 18 4000 5000
11 24 5000 71 8000 2000
12 22 5000 99 10000 (3000)

Estimated balance at the end of 12th week = ` (3,000)


Highest balance = ` 7,000
Average balance during the quarter = 45,000/12 = ` 3,750

Website: [Link] / Contact: 033 4059 3800


| 83
CMA Inter
Operations Management & Strategic Management
Simulation

Ex. Book No. Pg. No.


4
A businessman is considering taking over a certain new business. Based on past information
and his own knowledge of the business, he works out the probability distribution of the
monthly costs and sales revenues, as given here:
Cost (in `) Probability Sales Revenue (`) Probability
17000 0.10 19000 0.10
18000 0.10 20000 0.10
19000 0.40 21000 0.20
20000 0.20 22000 0.40
21000 0.20 23000 0.15
24000 0.05

a. Use the following sequences of random numbers to be used for estimating costs and
revenues. Obtain the probability distribution of the monthly net revenue.
82 84 28 82 36 92 73 91 63 29
Sequence 1
27 26 92 63 83 02 10 39 10 10
39 72 38 29 71 83 19 72 92 59
Sequence 2
49 39 72 94 04 92 72 18 09 00

b. Repeat the analysis in (a) by using the following random number streams:
20 63 46 16 45 41 44 66 87 26
Sequence 1
78 40 29 92 21 36 57 03 28 08
23 57 99 84 51 29 41 11 66 30
Sequence 2
41 80 62 74 64 26 41 40 97 15

Reference What’s New


Monthly Cost and Revenue

Answer
Cumulative Random Cumulative Random
Costa. (`) Cost (`)
Probability Probability Range Probability Probability Range
17000 0.1 0.1 00-09 19000 0.1 0.1 00.09
18000 0.1 0.2 10-19 20000 0.1 0.2 10-19

Website: [Link] / Contact: 033 4059 3800


84 |CMA Inter
Operations Management & Strategic Management
Simulation

19000 0.4 0.6 20-59 21000 0.2 0.4 20-39


20000 0.2 0.8 60-79 22000 0.4 0.8 40-79
21000 0.2 1.0 80-99 23000 0.15 0.95 80-94
24000 0.05 1.00 95-99

Random No. for Random No. for Monthly Net


Month Cost (`) Cost (`)
Cost Sales Revenue (`)
1 82 21000 39 21000 -
2 84 21000 72 22000 1000
3 28 19000 38 21000 2000
4 82 21000 29 21000 -
5 36 19000 71 22000 3000
6 92 21000 83 23000 2000
7 73 20000 19 20000 -
8 91 21000 72 22000 1000
9 63 20000 92 23000 3000
10 29 19000 59 22000 3000
11 27 19000 49 22000 3000
12 26 19000 39 21000 2000
13 92 21000 72 22000 1000
14 63 20000 94 23000 3000
15 83 21000 04 19000 (2000)
16 02 17000 92 23000 6000
17 10 18000 72 22000 4000
18 39 19000 18 20000 1000
19 10 18000 09 19000 1000
20 10 18000 00 19000 1000
Average = 35000/20 = `1750.

Ex. Book No. Pg. No.


5
An automobile production line turns out about 100 cars a day, but deviations occur owing
to many causes. The production is more accurately described by the probability distribution
given below:
Production/Day Prob. Production/Day Prob.
95 0.03 101 0.15
96 0.05 102 0.10

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 85
Simulation

97 0.07 103 0.07


98 0.10 104 0.05
99 0.15 105 0.03
100 0.20
Total 1.00
Finished cars are transported across the bay, at the end of each day, by ferry.

If the ferry has space for only 101 cars, what will be the average number of empty space on
the boat? Use following Random Numbers to simulate the data provided above - 20, 63, 46,
16, 45, 41, 44, 66, 87, 26, 78, 40, 29, 92, 21.

Reference What’s New


Empty Space & No. of waiting

Answer
Simulation of data of an Automobile Production line
Production/day Probability Cumulative Probability Random No. Range
95 0.03 0.03 00-02
96 0.05 0.08 03-07
97 0.07 0.15 08-14
98 0.10 0.25 15-24
99 0.15 0.40 25-39
100 0.20 0.60 40-59
101 0.15 0.75 60-74
102 0.10 0.85 75-84
103 0.07 0.92 85-91
104 0.05 0.97 92-96
105 0.03 1.00 97-99
1.00

Simulated data
[Link] cars waiting to No. of empty space on the
Day Random No. Production
be shipped boat
1 20 98 - 3
2 63 101 - -
3 46 100 - 1
4 16 98 - 3

Website: [Link] / Contact: 033 4059 3800


86 |CMA Inter
Operations Management & Strategic Management
Simulation

5 45 100 - 1
6 41 100 - 1
7 44 100 - 1
8 66 101 - -
9 87 103 2 -
10 26 99 - 2
11 78 102 1 -
12 40 100 - 1
13 29 99 - 2
14 92 104 3 -
15 21 98 - 3
Total 6 18
Average no. of empty space on the boat = 18/15 = 1.2 per day

Ex. Book No. Pg. No.


6
The manager of a book store has to decide the number of copies of a particular tax law book to
order. A book costs ` 60 and is sold for ` 80. Since some of the tax laws change year after year,
any copies unsold while the edition is not current must be sold for ` 30. From past records, the
distribution of demand for this book has been obtained as follows:
Demand (No of copies) 15 16 17 18 19 20 21 22
Proportion 0.05 0.08 0.20 0.45 0.10 0.07 0.03 0.02

Using the following sequence of random numbers, generate the demand for 20 time periods
(years). Calculate the average profit obtainable under each of the courses of action open to
the manager. What is the optimal policy?

14 02 93 99 18 71 37 30 12 10
88 13 00 57 69 32 18 08 92 73

Reference What’s New


Unsold Books

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 87
Simulation

Answer
Random No. Range Table
Demand Probability CumulativeProbability Random No. Range
15 .05 .05 00-04
16 .08 .13 5-12
17 .20 .33 13-32
18 .45 .78 33-77
19 .10 .88 78-87
20 .07 .95 88-94
21 .03 .98 95-97
22 .02 1.00 98-99
Total 1.00 – –
Calculation of demand and profit for next 20 years
Random No. of books unsold if stock is
Expecteddemand
Year Numbers 16* 17* 18*
1 14 17 - - 1
2 02 15 1 2 3
3 93 20 - - -
4 99 22 - - -
5 18 17 - - 1
6 71 18 - - -
7 37 18 - - -
8 30 17 - - 1
9 12 16 - 1 2
10 10 16 - 1 2
11 88 20 - - -
12 13 17 - - 1
13 00 15 1 2 3
14 57 18 - - -
15 69 18 - - -
16 32 17 - - 1
17 18 17 - - 1
18 08 16 - 1 2
19 92 20 - - -
20 73 18 - - -
Total 2 7 18

Website: [Link] / Contact: 033 4059 3800


88 |CMA Inter
Operations Management & Strategic Management
Simulation

*Looking at the simulated demand pattern, these stock figures have been chosen to find out
optimal course of action. Stock figures of 20 or more have not been considered because it is
quite obvious that such figures will not give optimal course of action due to high losses for
the unsold books.
Statement Showing Computation of Profit
No. of Books No. of Books sold in 20 years Average Profit/Year
*Net Profit (`)
order (n) (n × 20 - Books unsold) (Profit ÷ 20)
15 15 × 20 = 300 ` 6000 ` 300
16 16 × 20 – 2 = 318 ` 6300 ` 315
(318 × 20) – 2 × 30
17 (17 × 20) – 7 = 333 ` 6450 ` 322.5
(333 × 20) -7 × 30
18 (18 × 20) – 18 ` 6300 ` 315
(342 × 20) – 18 × 30
* Net Profit = No. of books sold × ` 20# – No. of books unsold × ` 30**
Selling price/book = `80, Cost/book = ` 60
#
Profit /book = 80 – 60 = ` 20
Selling price of any unsold book = ` 30
**Loss incurred/unsold book = ` 60 – ` 30 = ` 30
Since profit is maximum for 17 books order, the optimal policy is to order 17 books per year.

Ex. Book No. Pg. No.


7
A book store wishes to carry ‘Ramayana’ in stock. Demand is probabilistic and replenishment
of stock takes 2 days (i.e. if an order is placed on March 1, it will be delivered at the end of the
day on March 3). The probabilities of demand are given below:
Demand (daily) 0 1 2 3 4
Probability 0.05 0.10 0.30 0.45 0.10

Each time an order is placed, the store incurs an ordering cost of ` 10 per order. The store also
incurs a carrying cost of ` 0.50 per book per day. The inventory carrying cost in calculated on
the basis of stock at the end of each day.
The manager of the bookstore wishes to compare two options for his inventory decision.
A. Order 5 books when the inventory at the beginning of the day plus order outstanding is
less than 8 books.
B. Order 8 books when the inventory at the beginning of the day plus order outstanding is
less than 8.

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 89
Simulation

Currently (beginning 1st day) the store has a stock of 8 books plus 6 books ordered two days
ago and expected to arrive next day.
Using Monte-Carlo Simulation for 10 cycles, recommend, which option the manager, should
choose.
The two digit random numbers are given below:
89 34 70 63 61 81 39 16 13 73

Reference What’s New


Books- Selection of ROQ

Answer
Demand Probability Cumulative Probability Random No. Range
0 0.05 0.05 00-04
1 0.10 0.15 05-14
2 0.30 0.45 15-44
3 0.45 0.90 45-89
4 0.10 1.00 90-99
Option - A
Random Opening Ordered Quantity Quanity for which
Day Demand ClosingStock
No. Stock receipt Order Placed
1 89 3 8 - 5 -
2 34 2 5 6 9 -
3 70 3 9 - 6 0
4 63 3 6 - 3 5
5 61 3 3 0 0 -
6 81 3 0 5 2 5
7 39 2 2 - 0 5
8 16 2 0 5 3 -
9 13 1 3 5 7 -
10 73 3 7 - 4 5

Ordering cost 4 × 10 ` 40
Carrying cost 0.5 × 39 ` 19.50
Total Cost ` 59.50

Website: [Link] / Contact: 033 4059 3800


90 |CMA Inter
Operations Management & Strategic Management
Simulation

Option B
Opening Ordered Quantity Quanity for which
Day R No. Demand ClosingStock
Stock receipt Order placed
1 89 3 8 - 5 -
2 34 2 5 6 9 -
3 70 3 9 - 6 -
4 63 3 6 - 3 8
5 61 3 3 - 0 -
6 81 3 0 8 5 -
7 39 2 5 - 3 8
8 16 2 3 - 1 -
9 13 1 1 8 8 -
10 73 3 8 - 5 -
45

Ordering cost 2 × 10 ` 20.0


Carrying cost 0.5 × 45 ` 22.50
Total Cost ` 42.50
Option ‘B’ is better because it has low Inventory cost.

Ex. Book No. Pg. No.


8
A retailer deals in a perishable commodity. The daily demand and supply are variables. The
data for the past 500 days show the following demand and supply:
Availability (Kg.) Supply (No. of days) Demand (Kg.) Demand (No. of days)
10 40 10 50
20 50 20 110
30 190 30 200
40 150 40 100
50 70 50 40
The retailer buys the commodity at ` 20 per kg. and sells at ` 30 per kg. Any commodity
remains at the end of the day, has no sales value. Moreover the loss on unsatisfied demand is ` 8
per Kg. Given the following pair of random numbers, simulate 6 days sales, demand and profit:
(31, 18) (63, 84) (15, 79) (07, 32) (43, 75) (81, 27). The first random number in the pair is that of
supply and the second random number is for demand.

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 91
Simulation

Reference What’s New


Lost demand and supply

Answer
Table-1: Probability Distribution (Supply)
Supply Probability Cum. Prob. Range Range of Random Nos. forsimulation
10 40/500 = 0.08 0.08 0 - 0.08 00 - 07
20 50/500 = 0.10 0.18 0.08 - 0.18 08 - 17
30 190/500 = 0.38 0.56 0.18 - 0.56 18 - 55
40 150/500 = 0.30 0.86 0.56 - 0.86 56 - 85
50 70/500 = 0.14 1.00 0.86 - 1.00 86 - 99
Table-2: Probability distribution (Demand)
Range of Random Nos.
Demand Probability Cum. Prob. Range
forsimulation
10 50/500 = 0.10 0.10 0 - 0.10 00 - 09
20 110/500 = 0.22 0.32 0.10 - 0.32 10 - 31
30 200/500 = 0.40 0.72 0.32 - 0.72 32 - 71
40 100/500 = 0.20 0.92 0.72 - 0.92 72 - 91
50 40/500 = 0.08 1.00 0.92 - 1.00 92 - 99
Table-3: Showing simulated data
Simulated data for supply Simulated data for demand
Day Random No. Supply (Kg.) Day Random No. Demand (Kg.)
1 31 30 1 18 20
2 63 40 2 84 40
3 15 20 3 79 40
4 07 10 4 32 30
5 43 30 5 75 40
6 81 40 6 27 20

Website: [Link] / Contact: 033 4059 3800


92 |CMA Inter
Operations Management & Strategic Management
Simulation

Table-4: Statement Showing Supply, Demand and Profit


*Sales Loss due to unsatisfied
Day Supply Demand Cost (II) Profit (`)
Revenue demand (III)
(e) = (b) ×
(a) (b) (c) (d) (f) = [(c)–(b)]× `8/kg (g) = (d)-(c)-(f)
`20/kg

1 30 20 600 600 - Nil


2 40 40 1,200 800 - 400
3 20 40 600 400 160 40
4 10 30 300 200 160 -60**
5 30 40 900 600 80 220
6 40 20 600 800 - -200**
* (1) Sales revenue = Demand × Selling price, when Demand < Supply
(2) Sales revenue = Supply × Selling price, when Demand > Supply
** Negative figures indicate loss

Ex. Book No. Pg. No.


9
After observing heavy congestion of customers over a period of time in a petrol station, Mr.
Petro has decided to set up a petrol pump facility on his own in a nearby site. He has compiled
statistics relating to the potential customer arrival pattern and service pattern as given below.
He has also decided to evaluate the operations by using the simulation technique.
Arrivals Services
Inter-arrival time
Probability Service time (minutes) Probability
(minutes)
2 0.22 4 0.28
4 0.30 6 0.40
6 0.24 8 0.22
8 0.14 10 0.10
10 0.10

Assume:
(i) The clock starts at 8:00 hours
(ii) Only one pump is set up.
(iii) The following12 Random Numbers are to be used to depict the customer arrival pattern:
78, 26, 94, 08, 46, 63, 18, 35, 59, 12, 97 and 82.
(iv) The following 12 Random Numbers are to be used to depict the service pattern: 44, 21,
73, 96, 63, 35, 57, 31, 84, 24, 05, 37

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 93
Simulation

You are required to find out the


(i) probability of the pump being idle, and
(ii) Average time spent by a customer waiting in queue.

Reference What’s New


Queue - Petrol Pump

Answer
Inter-arrival time Service time

Cumulative Range of Cumulative


Minutes Probability probability RandomNo. Minutes Probability probability Range

2 0.22 0.22 00-21 4 0.28 0.28 00-27


4 0.30 0.52 22-51 6 0.40 0.68 28-67
6 0.24 0.76 52-75 8 0.22 0.90 68-89
8 0.14 0.90 76-89 10 0.10 1.00 90-99
10 0.10 1.00 90 - 99 – – – –
Random Entry
Inter Service Random Service Waiting
No. for time in Idle
arrival start no for Service end time time of
Sl. inter queue time
time timeas service time as per customer
No. arrival asper (Mins.)
(Mins.) per clock time (Mins.) clock (Mins.)
time clock
1 78 8 8.08 8.08 44 6 8.14 - 8
2 26 4 8.12 8.14 21 4 8.18 2 -
3 94 10 8.22 8.22 73 8 8.30 - 4
4 08 2 8.24 8.30 96 10 8.40 6 -
5 46 4 8.28 8.40 63 6 8.46 12 -
6 63 6 8.34 8.46 35 6 8.52 12 -
7 18 2 8.36 8.52 57 6 8.58 16 -
8 35 4 8.40 8.58 31 6 9.04 18 -
9 59 6 8.46 9.04 84 8 9.12 18 -
10 12 2 8.48 9.12 24 4 9.16 34 -
11 97 10 8.58 9.16 05 4 9.20 18 -
12 82 8 9.06 9.20 37 6 9.26 14 -
Total Time 140 12

Website: [Link] / Contact: 033 4059 3800


94 |CMA Inter
Operations Management & Strategic Management
Simulation

Average time spent by the customer waiting in the queue = 140/12 = 11.67 minutes
Total idle time
Probability of idle time of petrol station = = 12/86 = 0.1395 time of the
Total Operating
Service Channel*
*Service End Time – 9.26 Hrs. Service Channel opened at 8.00 hrs. i.e. Total Time of the Service
Channel = 1 hr. 26 Mins = 86 Mins.

Ex. Book No. Pg. No.


10 
How simulated times can be used to gain a knowledge of the interface of two assembly
activities in an aircraft assembly operation, activities A precedes activity B, and inventory may
accumulate between the two activities. With the use of random numbers, a simulated sample
of performance times yielded the values shown (minutes) in the accompanying table.
Activity A Activity B
Random Number Time (min) Random Number Time
07 .3 63 .5
90 .8 44 .4
02 .2 30 .4
50 .5 98 .9
76 .6 30 .4
47 .5 72 .6
13 .3 58 .5
06 .3 96 .9
79 .7 37 .4

(a) Simulated the assembly of six parts, showing idle time in activity B, waiting time of each
part, and number of parts waiting. Note: omit the first random number of A so that
activity B begins at time zero.
(b) What was the average length of the waiting line ahead of B (in number of units)?
(c) What was the average output per hour of the assembly line?

Reference What’s New


Assembly Line Simulation

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 95
Simulation

Answer
(a) Our interest lies in activity b, so we can set up a table (below) to show when parts arrive
at B, how long it takes B, how long it takes B to work on them, and the resultant idle and
waiting times:
Part Available Activity B Waiting Number parts
Part Activity B Activity B
for Activity B Beginning Time of Waiting at B
Number Ending Time Idle Time
at Time Time Part End time
1 - 0 .5 0 0 0
2 .8 .8 1.2 .3 0 1
3 1.0 1.2 1.6 0 .2 1
4 1.5 1.6 2.5 0 .1 1
5 2.1 2.5 2.9 0 .4 2
6 2.6 2.9 3.5* 0 .3 2
7 2.9 1.0 ** 2
8 3.2
* Total run time.
**Total waiting time.
Activity B begins at 0, and it takes .5 minute to complete the first part. B is then idle for .3
minute until part 2 arrives from A at .8 minutes. Part 2 takes .4 minute, so the ending time is .8
+ .4 = 1.2 minutes. By this time part 3 has been waiting. 2 minute because it became available
at .8 + .2 = 1.0 minute, but work could not be begun on it until 1.2 minutes. However, before
activity B is finished on part 3 at 1.6 minutes, part 4 has arrived (at 1.0 + .5 = 1.5 minutes) and
so one part is waiting. We continue systematically in this manner through part 6, noting that
when it is finished at time were 3.5 minutes,there are two parts waiting, for their availability
times were 2.9 minutes and 3.2 minutes, respectively.

(b) The average length of the waiting line (that is, average inventory) ahead of B can be
expressed in equation form as follows:
Total waiting time
Average inventory =
Total run time
1.0 assembly minute
=
3.5 minutes
= 0.29 assembly
(c) Average output per hour:

Units/hr =
6 unit
( )
60 min
3.5 minutes hr
= 102.9 units/hr.

Website: [Link] / Contact: 033 4059 3800


96 |CMA Inter
Operations Management & Strategic Management
Simulation

Ex. Book No. Pg. No.


11 
The Tit-Fit Scientific Laboratories is engaged in producing different types of high class
equipment for use in science laboratories. The company has two different assembly lines to
produce its most popular product ‘Pressure’. The processing time for each of the assembly
lines is regarded as a random variable and is described by the following distributions.
Process Time (minutes) Assembly A1 Assembly A2
10 0.10 0.20
11 0.15 0.40
12 0.40 0.20
13 0.25 0.15
14 0.10 0.05
Using the following random numbers, generate data on the process times for 15 units of
the item and compute the expected process time for the product. For the purpose, read the
numbers vertically taking the first two digits for the processing time on assembly A1 and the
last two digits for processing time on assembly A2.
4134 8343 3602 7505 7428
7476 1183 9445 0089 3424
4943 1915 5415 0880 9309
In the first stage, we assign random number intervals to the processing times on each of the
assemblies.

Reference What’s New


Assembly Line Simulation

Answer
Computation of Random Interval for Processing Time
A1 A2
Process time Minutes
Pi ∑Pi Range Pi ∑Pi Range
10 0.10 0.10 0-9 0.20 0.20 0-19
11 0.15 0.25 10-24 0.10 0.60 20-59
12 0.40 0.65 25-64 0.20 0.80 60-79
13 0.25 0.90 65-89 0.15 .095 80-94
14 0.10 1.00 90-99 0.05 1.00 95-99

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 97
Simulation

Simulated date for 15 units


Random No. Process Time Random No. Process Time Total
1 41 12 34 11 23
2 74 13 76 12 25
3 49 12 43 11 23
4 83 13 43 11 24
5 11 11 83 13 24
6 11 11 83 13 24
7 36 12 02 10 22
8 94 14 45 11 25
9 54 12 15 10 22
10 75 13 05 10 23
11 00 10 89 13 23
12 08 10 80 13 23
13 74 13 28 11 24
14 34 12 24 11 23
15 93 14 09 10 24
182 167 349
Average Process time for
A1 = 182/15 = 12.13 MinutesA2 = 167/15 = 11.13 Minutes
For product = 349/15 = 23.27 Minutes
Expected process time for the product = 23.27 minutes (12 .13 + 11.13)

Ex. Book No. Pg. No.


12 
Empirical data collected on the time required to weld a transformer bracket were recorded to
the nearest ¼ minute, as shown in the accompanying table.
Weld Time (min) Numbers of Observation
< .25 0
.25 < .75 24
.75 < 1.25 42
1.25 < 1.75 72
1.75 < 2.25 38
2.25 < 2.75 14
2.75 < 3.25 10

Website: [Link] / Contact: 033 4059 3800


98 |CMA Inter
Operations Management & Strategic Management
Simulation

(a) Formulate a cumulative distribution in percentage terms.


(b) Graphs the frequency and cumulative distributions.
(c) A simulation is to be conducted using random numbers. What simulated weld times
(to the nearest .25minute) would result from the random numbers 25, 90, and 59?
(d) What proportion of the times exceed 2.0 minutes?

Reference What’s New


Graph of Frequency Table

Answer
(a) Cumulative distributions are usually formulated on a scale where the cumulative
percentage is “more than”or “less than” a corresponding X axis amount. We shall use a
“less than” percentage and so will need to identify the upper- class boundaries (UCB) as
the Y coordinates for the cumulative distribution.
Weld Time Frequency Upper – Class Cumulative Number Of Cumulative Percent-
(Min) In Numbers Boundary (UCB) Times < UCB age Of Time < UCB
< .25 0 .25 0 0
.25 < .75 24 .75 24 12
.75 < 1.25 42 1.25 66 33
1.25 < 1.75 72 1.75 138 69
1.75 < 2.25 38 2.25 176 88
2.25 < 2.75 14 2.75 190 95
2.75 < 3.25 10 3.25 200 100
(b) The frequency distribution is constructed by extending vertical lines from the class
boundaries to the appropriate frequency level for the class. For the cumulative
distribution, values of the cumulative percentage of time < UCB are plotted at weld times
corresponding to the UCB. For example, the frequency (12 percent) is plotted at UCB =
.75 (as illustrated below).

Website: [Link] / Contact: 033 4059 3800


| 99
CMA Inter
Operations Management & Strategic Management
Simulation

80
72
80
72
60

60
42
40 38
42
40 38
24
20
24 14
10
20
14
10
0 0.75 1.75 2.75
0.25 1.25 2.25 3.25

0 0.75 1.75 2.75


100 0.25 1.25 2.25 3.25 100

100 100
Cumulativer Percentage of Time Values < UCB

80 80
Cumulativer Percentage of Time Values < UCB

80 80

60 60

60 60

40 40

40 40
RN 25
20 20
RN 25
20 20

0 0
0.75 1.75 2.75
0.25 1.25 2.25 3.25
0 0
Weld Time (min)
0.75 1.75 2.75
0.25 1.25 2.25 3.25
Weld Time (min)

(a) The simulated time for random number (RN) 25 is determined by entering the cumulative
graph at 25 (as shown by the arrow) and proceeding horizontally to the curve and then

Website: [Link] / Contact: 033 4059 3800


100 |CMA Inter
Operations Management & Strategic Management
Simulation

down to the weld time. The resultant is a reading of 1.0 minute (rounded to the nearest.
25 minutes). Times for random number 90 and 59 are 2.5 and 1.5 minutes, respectively.
(A larger graph would lend more accuracy.)
(b) From the cumulative distribution, about 12 percent of the times exceed 2.0 minutes.

Ex. Book No. Pg. No.


13 
An automobile production line turns out about 100 cars a day, but deviations occur owing
to many causes. The production is more accurately described by the probability distribution
given below:
Production/Day Prob. Production/Day Prob.
95 0.03 101 0.15
96 0.05 102 0.10
97 0.07 103 0.07
98 0.10 104 0.05
99 0.15 105 0.03
100 0.20
Total 1.00
Finished cars are transported across the bay, at the end of each day, by ferry.
If the ferry has space for only 101 cars, what will be the average number of cars waiting to be
shipped? Use following Random Numbers to simulate the data provided above - 20, 63, 46,
16, 45, 41, 44, 66, 87, 26, 78, 40, 29, 92, 21.

Reference What’s New


Empty Space & No. of waiting

Answer
Simulation of data of an Automobile Production line
Production/day Probability Cumulative Probability Random No. Range
95 0.03 0.03 00-02
96 0.05 0.08 03-07
97 0.07 0.15 08-14
98 0.10 0.25 15-24
99 0.15 0.40 25-39
100 0.20 0.60 40-59

Website: [Link] / Contact: 033 4059 3800 CMA Inter


Operations Management & Strategic Management | 101
Simulation

101 0.15 0.75 60-74


102 0.10 0.85 75-84
103 0.07 0.92 85-91
104 0.05 0.97 92-96
105 0.03 1.00 97-99
1.00

Simulated data
[Link] cars waiting to No. of empty space on the
Day Random No. Production
be shipped boat
1 20 98 - 3
2 63 101 - -
3 46 100 - 1
4 16 98 - 3
5 45 100 - 1
6 41 100 - 1
7 44 100 - 1
8 66 101 - -
9 87 103 2 -
10 26 99 - 2
11 78 102 1 -
12 40 100 - 1
13 29 99 - 2
14 92 104 3 -
15 21 98 - 3
Total 6 18
Average no. of cars waiting to be shipped = 6/15 = 0.40 per day

Website: [Link] / Contact: 033 4059 3800


102 |CMA Inter
Operations Management & Strategic Management

You might also like