Three activities are candidates for crashing on a CPM network.

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Description

Three activities are candidates for crashing on a CPM network.

1. Three activities are candidates for crashing on a CPM network. Activity details are in the table below.

. Activity . Normal Time . Normal Cost . Crash Duration . Crash Cost

. A . 9 days . $8,000 . 7 days . $12,000 .

B . 5 days . $2,000 . 3 days . $10,000

. C . 12 days . $9,000 . 11 days . $12,000

a. What is the crash cost per unit time for activity A?

b. What is the crash cost per unit time for activity B?

c. Which activity should be crashed first to cut one day from the project’s duration; how much is added to project cost?

d. Which activity should be the next activity crashed to cut a second day from the project’s duration; how much is added to project cost?

e. Assuming no other paths become critical, how much can this project be shortened at what total added cost?

2. Martin Manufacturing has implemented several programs to improve its productivity. They have asked you to evaluate the firm’s productivity by comparing this year’s performance with last year’s. The following data are available:

Has Martin Manufacturing improved its productivity during the past year?
. . Last Year . This Year

. Output . 10,500 units . 12,100 units
. Labor Hours . 12,000 . 13,200

. Utilities . $7,600 . $8,250

. Capital . $83,000 . $88,000

Has Martin Manufacturing improved its productivity during the past year?

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