Final Exam 531 Fall 2023
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Fall 2023 OR 531-DL4 Final Exam
INSTRUCTIONS
1. Description You will have 8 hours to complete the four problems plus a bonus question for the
exam. The final will open on Monday Dec 11 at 4:00 pm as an assignment on blackboard.
2. Due Date (All times in ET) This Test is due on Dec 11, 2023 at 11:59 PM EDT.
3. This is an open book test and is an
“
individual
”
assignment.
4. Please save your work in two excel files (keep your simulation problem in a separate excel file)
and save as lastname.firstname-optimization.xls and the simulation file as lastname.firstname-sim.xls.
5. Save your work and answers in an Excel file, so I can see how you have formulated the problems
using the frontline solver software
6. Please also email your excel files to me at jfergus3@gmu.edu
Problem #1 (Chapter 12) (25 points)
A painting operation is scheduled in blocks, where each block involves painting products with a
particular color. Cleaning time is required in between each pair of blocks so that the equipment can be
prepared for the new color. In each cycle there is one block of each color, and the total painting time is
determined by the volume of orders. However, the actual schedule length is determined by the
sequence in which the blocks are scheduled, since the cleaning time depends on the color in the
previous block and the color in the next block. The following table gives the number of minutes required
to clean the equipment, according to the color pair.
Using your Frontline solver software solve the optimization problem to answer the questions below:
a) What block sequence minimizes the amount of time spent in cleaning during a full cycle?
b) What is the minimum number of minutes devoted to cleaning?
c) What would be the minimum block sequence and time devoted to cleaning if you are told that color 4
cannot follow color 1 in the sequence and color 6 cannot follow color 5 in the sequence?
Problem #2 (Chapter 13) (25 points)
One of our corporate competitors is threatening us with a lawsuit for patent infringement. The
competitor is already in court in a similar lawsuit against another firm, and our legal staff estimates that
there is a 40 percent chance that our competitor will prevail. One option open to us is to settle out of
court now; the alternative is to wait until the current case is resolved before taking action. If our
To Color
From
Color
1
2
3
4
5
6
1
-
4
8
6
8
2
2
5
-
7
11
13
4
3
11
6
-
8
4
3
4
5
7
2
-
2
5
5
10
9
7
5
-
2
6
8
4
3
6
5
-
competitor loses the other suit, it will not pursue an action against us. On the other hand, if the
competitor wins, it is likely to sue us. Our legal staff estimates that likelihood at 70 percent. They further
estimate that the suit would be brought for $20 million. We can settle now for $5 million.
If the competitor sues us, we can negotiate a settlement, go to trial and contest the patent infringement
claim, or go to trial and concede the patent infringement but fight the settlement amount. In either case,
of course, the trial will dictate the monetary outcome. Our legal staff estimates that a negotiated
settlement would cost us roughly $15 million. If we contest the patent, we have a 30 percent chance of
winning the suit. If we concede the patent and contest the settlement amount, then the only question
would be the size of that amount. Our legal staff envisions two possibilities: High, at $25 million, with a
60 percent probability, and Low, at $5 million, with a 40 percent probability.
Using your Frontline solver software solve the decision analysis problem to answer the questions below:
a) What is the best decision based on the expected payoff criterion?
b) What is the expected payoff?
c) Using the psisenvalue and psisenparameter functions, create a sensitivity analysis to show how the
best decision and expected payoff would change if the probability of the opponent winning is varied
from .1 to .9 by .1 increments.
Problem #3 (25 points) show answers in a separate tab in your excel spreadsheet
a) Binary and logical relationships. Which of the following constraints represents at most one project can
be selected?
y4 = y5 = 1, y2 + y5 > 1, y4 + y5 < 1, or y4 + y5 = 1
b) Binary and logical relationships. Which of the following constraints prohibits the combination?
y4 = y5 = 1, y2 + y5 > 1, y4 + y5 < 1, or y4 + y5 = 1
c) Which of the following is a uniform distribution?
#1
#2
#3
d) Based on the figure below, what is the probability that your model’s value will be >= $0?
Problem #4 (Chapter 14) (25 points)
Butson Stores faces a problem in maintaining sufficient cash balances for operations over the first six
months of the year. Each month, they must pay certain fixed costs and taxes (see the following table), as
well as materials costs that run about 80 percent of the current month’s sales. Monthly cash receipts
consist of revenues from the previous month’s sales, as well as 1 percent interest on short-term cash
balances. The company enters the six-month period with a cash balance of $250,000 and wishes to
maintain at least that balance each month in order to cover cash needs. December sales of $1.4 million
have just been recorded. If Butson finishes a month with less than $250,000 in cash, the company can
take out a one-month loan at 2 percent interest. The principal and interest are repaid in the following
month. Butson’s marketing department has made estimates (in thousands) for the mean and standard
deviation of sales in each of the next six months (see the following table).
Fixed Costs and Taxes
(000)
Mean Sales
(000)
Standard Deviation of Sales
(000)
January
250
1800
80
February
350
1500
80
March
300
2000
90
April
400
1700
90
May
350
2200
100
June
350
1900
100
Using your Frontline solver software solve the simulation problem to answer the questions below:
a) How large their maximum monthly loan is likely to be, and how likely they are to exceed their current
credit limit of $750,000?
b) How much on average they will have to pay in interest costs for loans?
c) Fit the following table to a distribution and use this distribution for January – June actual sales (000).
1847
1841
1695
1969
1926
1901
1790
1824
1823
1853
1704
1814
2005
1893
1802
2034
1817
1885
1742
1934
1826
1874
1856
2030
2028
1906
2027
1875
1859
1755
1787
1861
1916
1696
1959
1862
1645
1889
1736
1968
Your preview ends here
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1824
1908
1948
1865
1801
1664
1967
1773
2014
2035
1779
1895
1883
1900
1873
1884
1902
1755
1826
1674
1824
1735
1906
1862
1786
1919
1830
1897
1714
1818
1888
1776
1886
1880
1956
1718
1870
1697
1754
1827
1769
1853
1944
1917
1928
1649
1814
1881
1849
1810
2020
1852
1812
1992
1803
1960
1893
1760
1939
1697
1676
1954
2066
1904
1950
1847
2087
1827
1871
1962
1835
1891
1942
1892
1791
1889
1866
1892
1824
1916
1865
2049
1964
1845
1848
1637
1864
1778
1783
1780
1794
1741
1738
1799
1940
1815
1812
1842
1800
1874
1950
1832
1903
1825
1917
1836
1845
1785
1811
1774
1829
1964
1903
1622
1816
1849
1928
1934
1997
1814
1692
1698
1965
1942
1844
1934
1950
1915
1759
1790
1841
1807
1752
1835
1774
1923
1814
1785
1675
1887
1881
1891
1647
1942
1777
1816
1826
1841
1794
1851
1736
1817
1960
1887
1847
1875
1817
2027
1778
1866
d) With these new distributions for sales, how large their maximum monthly loan is likely to be, and how
likely they are to exceed their current credit limit of $750,000?
Bonus problem #5 (chapter 10) (20 points)
Parents Ann and Jim want to provide for their daughter’s college expenses with some of the money they
have recently inherited. They hope to set aside part of the money and establish an account that would
cover the needs of their daughter’s college education, which begins seven years from now, with a one-
time investment. Their estimate is that first-year college expenses will come to $30,000 and will increase
$2,000 per year during each of the remaining three years of college. The following investment
instruments are available:
Investment
Available
Matures
Return at Maturity
A
Every year
In 1 year
4%
B
In years 1,3,5,7,9
In 2 years
9%
C
In years 1,4,7
In 3 years
14%
D
In years 1,5
In 4 years
20%
E
In year 1
In 10 years
39%
Using your Frontline solver software solve the optimization problem to answer the questions below:
a) What is the minimum amount of money that needs to be invested to cover the future college
expenses?
b) What is the investment strategy?
c) If they have to invest equal amounts of money in investment A as they invest in all the other
investments collectively, how does this change your investment strategy?
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Exercise 9-12 a-b (Part Level Submission)
Oriole Supply Co. has the following transactions related to notes receivable during the last 2 months of 2020. The company does not make entries to accrue interest except at
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Assignment - 1. Credit Scores and Loans
Attempt 1 of 1
ASSIGNMENTS
COURSES
SECTION 3 OF 4
QUESTION 6 OF 8
1
2
4
5
>>
Match the option with the lowest monthly payment to highest monthly payment.
$12,000 loan with 1% simple
1.
lowest payment
interest over 7 years
$7,500 loan with 4% simple interest
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over 5 years
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Analysis of Receivables Method
At the end of the current year, Accounts Receivable has
balance of $4,375,000; Allowance for Doubtful Accounts has a debit balance of $21,300; and sale
for the year total $102,480,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $205,000.
a. Determine the amount of the adjusting entry for uncollectible acfounts.
b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.
Accounts Receivable
Allowance for Doubtful Accounts
Bad Debt Expense
c. Determine the net realizable value of accounts receivable.
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What Is Big, Gray, and Lives
in California?
Find the volume of each prism. Write the letter of the exercise in the box above the
answer at the bottom of the page.
4.5 cm
A
6 cm
5.8 cm
25 in.
P
T
10 m
N
8m
6.4 cm
30
25 in.
A
8 cm
30 in.
20 in.
30 in.
6.2 cm
20 in.
9.6 cm
12 cm
N
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4.3 cm
H
DOA
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5 in.
6 in.
8.5 in.
83.8 cm³
357.12 cm3
76.8 cm³
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156.6 cm³
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364.5 m3
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390
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160 m³
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MATHEMATICS 6 | FOURTH QUARTER I PROBLEM SET 1
PREPARED BY: SIR K
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1
4
8
You get a personal loan of $5,000 with 12% simple interest too be paid over 30 months. What is your monthly payment?
O $150.00
O $166.67
O $216.67
O $175.00
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A newspaper editor starts a retirement savings plan in which $225 per month is deposited at the beginning of each month into an account that earns an annual interest rate of 6.4% compounded monthly.
Find the value of this investment (in dollars) after 20 years. (Round your answer to the nearest cent.)
$
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logo design company purchases four new computers for $12,500. The company finances the cost of the computers for 3 years at an annual interest rate of 5.175% compounded monthly. Find the month
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ring the first month of operations, Johnson Services, Ic., completed the following transactions:
(Click the icon.to view the transaction data.)
ead the requirements.
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s. Exclude explanations from journal entries.)
Lequirement 1. Record each transaction in the
Mar 2: Johnson Services received $62,000 cash
Mar 2 Johnson Services received $62,000 cash and issued common stock to the
Journal
stockholders.
Accounts
3 Purchased supplies, $600, and equipment, $11,400 on account.
Date
4 Performed services for a customer and received cash, $5,500.
7 Paid cash to acquire land, $38,000.
Mar
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Exercise 1-14 (Part Level Submission)
g 2021
Cheyenne Corp., a public camping ground near the Four Corners National Recreation Area, has compiled the following financial information as of December 31, 2019.
Revenues during 2019-camping fees
$190,400
Notes payable
$81,600
1-4
Revenues during 2019-general store
63,920
Expenses during 2019
204,000
1-5
1-6
Accounts payable
14,960
Supplies on hand
3,400
Cash on hand
27,200
Common stock
27,200
Original cost of equipment
143,480
Retained earnings
?
1-8
e1-9
e 1-11
w14
v 1-5
Fair value of equipment
190,400
v (a)
Your answer is correct.
Determine Cheyenne Corp.'s net income for 2019.
11
14 (Part
mission)
Cheyenne Corp.'s net income
50320
-4A (Part
mission)
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Oshifting the graph of f(x) to the right 39 units
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shifting the graph of f(x) downwards 39 units
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Publisher:Mcgraw-hill Education,
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Foundations Of Finance
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Publisher:Pearson,
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Fundamentals of Financial Management (MindTap Cou...
Finance
ISBN:9781337395250
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Cengage Learning
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Corporate Finance (The Mcgraw-hill/Irwin Series i...
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ISBN:9780077861759
Author:Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
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