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INDIAN SCHOOL OF BUSINESS
MANAGEMENT AND ADMINISTRATION
AN ISO 9001:2015 CERTIFIED INTERNATIONAL
B-SCHOOL
Name :
Marks : 80
Course :Masters
in Business Administration (MBA 4 Sem)
Subject : Quantitative
Methods
Case Studies
Linear Programming (20
Marks)
Lexicographic Goal
Programming is used to solve a series of Linear Programming Model. This
programming is used wen . a goal has to be attained on•priority basis. Revenue
budgeting is being used to decide budget instead of a specific system in
budget. Nevertheless, revenue budget lays emphasis on the rising limitation of
revenue while estimating budget. The decision makers are limited due to the
rising power of capital and also the awareness of imminent restraints and fear
of capital resources. The goal is to raise the salary and allowance of the
workers,to cut down the operating cost, to raise the revenue expenses, to raise
the capital generated internally, and the cut down the overall budget. Some of
the problems are: insufficient allocation of funds and income, and• absence of
importance of order. The insufficient allotment occurred as the quantitative
allotment models were not used with power. . It is seen that the allotment of
capital were not being used in the right" way as a result the capital
allotted to the labs is drawn •in the maintenance of hostel. Various other
changes also happen. In fact, the funds allotted to the tertiary organizations
are more often not managed properly. The University of Owerri suffered and the
progress of the institution came down. There is absence of active teams for
monitoring budget, and so the budget can function in any manner. If the active
teams to monitor budget were present, the problem of mismanagement and the
wrong use of it would come down. Sundaram (1978) and Lee (1972) agreed that the
various features of target programming are, that it allows ordinal solution.
According to Igniio (1978), this tactic called Goal Programming, frequently
symbolizes considerable progress in the modeling and evaluation of the multi
objective problems. This shows that this area lets the systematic evaluation of
a number of multi objective problems which could include linear or non linear
operations in the incessant or separate variables. This is most successful in
the research area. The goal programming developed due to Charnes and Cooper,
who suggested that the model and method for dealing with some linear
programming problems where the contradictory 'goals of management' involed as
limitations. Goal programming method has been used for a number of programs.
Goal programming technique has solved the following problems: planning
production in a ship repairing company, smoothing production in 'just in time'
production atmosphere. The problem occurs when the model does not show the real
inclination of the decision maker. Non-inferior solution in some cases many not
be essentially better than the lesser solution mainly in the case of natural
resource problem.
Answer the following
question.
Q1. What are the
problems while estimating the budget?
(Hint: insufficient
allocation of funds and income, and absence of importance of order, The
insufficient allotment occurred as the quantitative allotment models were not
used with power)
Answer : There are a
number of serious problems associated with budgeting, which include
gamesmanship, excessive time required to create budgets, and budgeting
inaccuracy. In more detail, the problems with budgeting include:
Ø Inaccuracy. A budget is based on a set
of assumptions that are generally not too far distant from the operating
conditions under which it was formulated. If the business environment changes
to any significant degree, the company’s revenues or cost structure may change
so radically that actual results will rapidly
Case Study
A monte Carlo
(20 Marks)
Laura,' a 57 year old
unmarried woman, earns around 68,000 dollars per year with expenditure of
37,500 dollars. She hit away 14,000 dollars each year and collected 330,000
dollars in her RRSP and TFSA, and also a rented apartment worth 250,000
dollars. She has a iixed pension given by her employer, although it is not
indicated to price rise, and Is entitled to get complete benefits of Canada
Pension Plan and Old Age Security, for retirement. She did not have a very
competent portfolio: one fourth of cash is there, and most of it was in
contracted sector ETFs, single stocks and business bonds. Due to wrong entry of
ETFs in the account, unnecessary taxes were charged. Even before reconstructing
Laura's portfolio,"he had to make certain that it matched with.her
financial aims. Laura's main aim was to ascertain if she could retire before
the age of 65, maybe as early as 60, therefore she had to know if her
investments could produce enough flow of cash after she retires. Monte Carlo
may show a top possibility of success with the allotment of equity of 70% ot
80%. Through a risky questionnaire and art open interview, Justin Ill
'ascertain that Laura was the best person for a portfolio of 60% fixed income
and 40% equities. . Through Monte Carlo software, Justin entered the current
portfolio . size of Laura, her rate of savings, projected retirement
expenditure, and other employer income and government pensions. If Laura feels
that working till the age of 63 was unpleasant, she could go for the
reproduction again and with different estimation.
10/1/2019 Aeren
Foundation
Increasing her anticipated
returns or bringing down the rate of inflation, is only a thought, therefore,
she will have to make some stronger decisions: she will have to making some
more savings, or bring down her rate of planned expenses after retirement.
Amazingly, by bringing up the allotment to fixed salary could increase her
opportunity to succeed: in spite of th returns being lower than the equities,
the volatility is also less, which lessens the risk of helpless decline in the
early years. At last, Laura decided to work for 6 more years and plan her
retirement at the age of 63. After this, Justin decided to help her make a
fresh ETF portfolio to match that goal: it was finalized at 30% short term
business bonds, 30% GICs, and the rest of it was divided among Canadian, L'S
and global equities. Laura was able to make a notified decision through the
Monte Carlo simulation, but this wasn't the end of the procedure. In two or
three years time, she will have to visit the location again to see that she is
still on the right path of her retirement goal, as many issues like, loss of
job, a legacy, new connections, increase in the interest rates, all these could
bring a change in the main suppusitions 1 ; and she will have to redo her
plans. The possibilities are different before the age of 63. For each added
year that Laura works, her portfolio will addition instead of a decrease and
this will lead to a thrilling difference: the success rate will rise up by 25%
points if she continues to work till the age of 61 instead of 60.
Answer the following
question.
Q1. How much was Laura
earning at the age of 57?
(Hint: 68,000 dollars
per year)
Answer :
A Network Rail (20
Marks)
The railways play an
important role in the economy and infrastructure of Britain. Not very many
people travelled back jn the 1920 as compared to present time, in spite of 50%
reduction in raif routes as compared to the 1960s. Rail is also used for transporting
goods around Britain. Rail proves to be• more eco-friendly and safest means of
transportation as compa;ed to other vehicles so, not surprisingly, the number
of people commuting have gone 40% more since the past ten years. By 2034, this
figure can go up. The work of network rail has to look after the tracks,
bridges and tunnels which comprises of the British rail network. The railway
infrastructure is made up of signals and level crossings. It has to look after
the 20,000 mile long track and 40,000 bridges and tunnels. Britain's 18 main
rail stations, from Edinburg Waverley to London King's Cross, are looked after
by the Britain rail system. Ten years ago, when the network rail took up these
responsibilities, • it had to face some challenges. The rail neork was facing
some problems. Trains were running late, the costs were too high and there was
shortage of assets in both the people and machinery. Due to these issues,
people had less confidence in the rail network. Ever since then, rail network
has aimed at sustaining operations to reduce the expenses. There has been 28%
reduction in expenses mainly because of conomy of scale. New tracks and
machinery have been bought, and there has been 90% rise in the rail
punctuality. Huge projects have been given on time an towards th budget, as a
result the confidence of the people has improved. Rail network has moved from
'find and fix' to 'predict and prevent' policy. This has proved to be more cost
effective and competent and enabled in avoiding delay or obstruction for the
people in their travel. The rail network invested approx. 12 billion pounds
between 2009 and 2014, towards the rail network. Britain has the fastest
developing network in whole of Europe. By investing in people, the rail network
is investing in the future to. .B ritain has the largest working personnel of
35,000 workers. It has people working in various positions, like, engineers for
maintenance and signaling to project managers. Each area offers an opportunity
to work. They also consist oi HR (human resources), IT (information
technology), and finance and customer service. Network Rail needs to employ and
keep capable engineers in order to get the work done. Presently, its engineers
are doing some oi the most stimulating projects in Europe. The projects include
HS2, which is the new super spted rail link between the north and south
Britain, and the project of London Crossrail. Some oi the biggest and busiest
rail stations are being upgraded, like, London King's Cross and Birmingham New
Street. The main focus of the HR of Network Rail is to recruit various
personnel. This not only deepens the culture of business but it also makes sure
that it can reach every talent. It offers training for every applicant, whether
he is a school drop-out or a graduate, whether male or female, a continued flow
of appropriate talent is ensured to keep its long term project going. The
company abo gives many opportunities to its workers to receive recognized
qualifications, such as an exclusive programme in post graduation, sponsoring
the Master's Degree in project management and trainee.
Answer the following
question.
Q1. What were the
initial problems that Network Rail of Britain face?
(Hint: It has to look
after the 20,000 mile long track and 40,000 bridges and tunnels. Trains were
running late, the costs were too high and there was shortage of assets in both
the people and machinery) Q2. What is the new super speed rail link between the
north and south Britain called? (Hint: HS2)
Answer : What is
Network Rail?
Network Rail (NR) was
set up in 2002 to replace Railtrack as the body responsible for Britain's rail
network. It holds a monopoly over Britain's rail infrastructure, a major
national asset, and as such is rigorously monitored to ensure accountability to
the public interest. Its network operating licence was originally issued to
Railtrack on March 31st 1994.
As a result NR is
limited by guarantee, which means it operates as a private company without a
profit-making function. Instead of shareholders, members drawn from the rail
industry and the general public hold the board to account by reviewing its
performance against pre-set targets. The Department for Transport (DfT) is also
a member, providing it with substantial subsidies each year.
Network Rail is the
owner (via its
CASE STUDY (20
Marks)
The price P per unit at
which a company can sell all that it produces is given by the function P(x) =
300 — 4x. The cost function is c(x) = 500 + 28x where x is the number of units
produced. Find x so that the profit is maximum.
Answer the following
question.
Q1. Find the value of
x.
Answer :
Q2. In using regression
analysis for making predictions what are the assumptions involved.
Answer : Building a
linear regression model is only half of the work. In order to actually be
usable in practice, the model should conform to the assumptions of linear
regression.
Assumption 1
The regression model is
linear in parameters
An example of model
equation that is linear in parameters
Y = a + (β1*X1) + (β2*X22)
Q3. What is a simple
linear regression model?
Answer
: Linear regression models are used to show or predict the
relationship between two variables
or factors. The factor that is being predicted (the factor that the
equation solves
for) is called the dependent variable. The factors that are
used to predict the value of the dependent variable are called the independent
variables.
Good data does not always tell the
complete story. Regression analysis is commonly used in research as it
establishes that a correlation exists between variables. But correlation
is not the same as causation. Even a line in a simple linear
regression that fits the data points well may not say something definitive
about a cause-and-effect relationship.
In simple linear regression,
each observation consists
of two values. One value is for the dependent variable and one value is
for the independent variable.
- Simple Linear Regression Analysis The
Q4. What is a scatter
diagram method?
Answer : The scatter
diagram is known by many names, such as scatter plot, scatter graph, and
correlation chart. This diagram is drawn with two variables, usually the first
variable is independent and the second variable is dependent on the first
variable.
The scatter diagram is used to
find the correlation between these two variables. This diagram helps you
determine how closely the two variables are related. After determining the
correlation between the variables, you can then predict the behavior of the
dependent variable based on the measure of the independent variable. This chart
is very useful when one variable is easy to measure and the other is not.
Example
Dear
students get fully solved assignments
Send
your semester & Specialization name to our mail id
help.mbaassignments@gmail.com
or
call us
at : 08263069601
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