BBA/B.Com Operations Research JUNE 2026

Description

Operations Research

Jun 2026 Examination

 

 

Q1. A chemical processing company suffered significant losses after a sudden, complete failure of its main reactor, despite recent routine inspections and no clear warning signs. The failure caused production to halt for a week and led to customer penalties. Senior management has asked for a new approach using simulation to anticipate catastrophic failures and develop more robust contingency plans. In this context, how can the management integrate simulation models to forecast equipment failure risk and optimize the company’s contingency response? Explain which type of simulation you would use and how the company could use simulation outputs for decision-making and risk reduction. (10 Marks)

Ans 1.

Introduction

Simulation is a quantitative operations research technique that uses mathematical and probabilistic models to replicate the behaviour of a real system over time. Unlike analytical methods that derive exact solutions under simplified assumptions, simulation can model complex, interdependent, and stochastic systems where multiple failure modes interact in ways that are too intricate to solve mathematically. For a chemical processing company whose main reactor failed catastrophically without any visible warning signs, despite recent routine

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Q2 (A). In a high-volume rice distribution network, a major farmer cooperative faces persistent challenges related to fluctuating market demands and supply variances across regions. At times, prohibited routes due to infrastructure failures further restrict available options. The cooperative needs to decide whether to focus on minimizing transportation costs or shift to a maximization problem to prioritize profit, particularly when opportunities in profitable markets arise. Board members are divided, as some favor cost-cutting while others see greater value in profit-driven allocations, especially under constraints of unbalanced supply and prohibited routes. Evaluate the trade-offs between formulating the transportation problem in the context of fluctuating supply, demand, and route restrictions. Justify which approach should be adopted for the cooperative to remain competitive and why? (5 Marks)

Ans 2(A).

Introduction

The transportation problem in operations research is a linear programming model that allocates goods from multiple supply sources to multiple demand destinations in a manner that either minimises total transportation cost or maximises total profit, subject to supply and demand constraints. For the farmer cooperative, both objectives are operationally relevant but they produce different allocation decisions and serve different strategic purposes. The choice between cost minimisation and profit maximisation as the primary objective function defines the cooperative’s entire distribution strategy and has direct consequences for its financial

Q2 (B). A construction consortium is debating whether to use the Critical Path Method (CPM) or PERT for its next infrastructure project. Some executives favor CPM for its clarity and simplicity with deterministic time estimates, while others highlight PERT’s flexibility with probabilistic timelines giving greater adaptability in the face of frequent delays and scope changes. With project scope likely to evolve and several activities lacking historical duration data, the leadership must decide which method will provide better control and accountability. Evaluate the suitability of CPM versus PERT in managing projects with significant uncertainty in activity durations and evolving scope? (5 Marks)

Ans 2(B).

Introduction

The Critical Path Method and PERT are both network-based project scheduling tools that identify the sequence of activities, interdependencies, and scheduling constraints governing a project’s completion timeline. CPM uses a single deterministic time estimate for each activity, derived from well-established historical data, and is best suited to projects where past execution experience makes duration prediction reliable. PERT uses three probabilistic time estimates, optimistic, most likely, and pessimistic, to compute an expected duration and a statistical