VAAL UNIVERSITY OF TECHNOLOGY

FACULTY OF ENGINEERING AND TECHNOLOGY

DEPARTMENT: INDUSTRIAL ENGINEERING, OPERATIONS
MANAGEMENT AND MECHANICAL ENGINEERING.

Diploma: Industrial Engineering

SUBJECT : OPERATIONAL RESEARCH 3

SUBJECT CODE : EBORE3A/ EBONA3B

DATE : June 2022

DURATION : 1 WEEKS

EXAMINERS : I. KHUMALO/ T.A. MATYATYA

MODERATORS : 1. DR. D. JURA

2. MS RITA STEENKAMP

TOTAL MARKS : -

FULL MARKS : -

PAPER CONSISTS OF : -

INSTRUCTIONS

1. Answer all questions.

2. Use computer and Excel solver or related software to do the
programming; and show all the formulae in your saved program files.

EBORE3A GA 5 Assignment 2022-1 Questions Page 1 of 4

Financial Applications 1 Excel Solver Project

The Plus500 Brokerage firm has just been instructed by one of its clients to invest
R250 000 of her money obtained recently through the sale of land holdings in Ohio. The
client has a good deal of trust in the investment house, but she also has her own ideas
about the distribution of the funds being invested. In particular, she requests that the firm
select whatever stocks and bonds they believe are well rated, but within the following
guidelines:

(1) Municipal bonds should constitute at least 20% of the investment.

(2) At least 40% of the funds should be placed in a combination of electronic firms,
aerospace firms, and drug manufacturers.
(3) No more than 50% of the amount invested in municipal bonds should be placed in a
high-risk, high-yield nursing home stock.

Subject to these restraints, the client's goal is to maximize projected return on

investments. The analysts at Plus500, aware of these guidelines, prepare a list of
high-quality stocks and bonds and their corresponding rates of return:

INVESTMENT PROJECTED RATE OF RETURN (%)

Los Angeles municipal bonds 5.3
Thompson Electronics, Inc. 6.8
United Aerospace Corp. 4.9
Palmer Drugs 8.4
Happy Days Nursing Homes 11.8

(a) Formulate (that is, setting up the objective function and constraints) Plus500
problem using LP. (18.5)

(b) Use your formulation in part (a) to form a Microsoft Excel Solver spreadsheet to
solve the LP problem. (46)

(c) State the optimal solution and the value of the objective function. (5)

End of assignment
Total marks = 69.5
Full marks = 69.5
EBORE3A GA 5 Assignment 2022-1 Questions Page 2 of 4
 Department of Industrial Engineering and Operations Management
Diploma in Industrial Engineering
OPERATIONAL RESEARCH 3 (EBORE3A)

Student initials & surname: __________________________

Student number: ___________________________________

Graduate Attribute 5: Engineering methods, skills, tools, including Information Technology

Learning Outcome: Use appropriate techniques, resources, and modern engineering tools, including information technology, prediction and modelling, for the solution of well-defined
engineering problems, with an understanding of the limitations, restrictions, premises, assumptions and constraints.

Range Statement: A range of methods, skills and tools appropriate to the discipline of the program including:
1. Sub-discipline-specific tools processes or procedures;
2. Computer packages for computation, simulation, and information handling;
3. Computers and networks and information infrastructures for accessing, processing, managing, and storing information to enhance personal productivity and teamwork;
4. Basic techniques from economics, management, and health, safety and environmental protection.

The outcome is assessed in the computer assignment in this module which is done during the
semester. Students use Excel solver or related software to solve complex linear programming/integer
Where is this outcome assessed?
programming/transportation models etc. This becomes one of the assessments that contributes to the
year mark of the student.
Learners are given well-defined but complex engineering problems, such as linear programming, integer
How is this outcome assessed?
programming, transportation problems etc. to solve using Excel solver or related software.
If the student fails to obtain the minimum of 50% in the computer assignment during the semester, he or
What is the consequence of unsatisfactory she will be granted another chance to redo/resubmit the assignment but he/she can then only obtain a
performance?
maximum of 50%. If the student does not obtain 50%, then the student has to repeat the subject.
What is a satisfactory performance? More than 50% for the computer assignment, according to the marking rubric.

EBORE3A GA 5 Assignment 2022-1 Questions Page 3 of 4

 Level 4 Level 3 Level 2 Level 1
Indicators Strong in GA5 Competent in GA5 Developing GA5 Needs work in GA5 Marks Score
75 – 100% 50 – 74% 25 – 49% 0 – 24%
Understand Tools: Demonstrates skilful ability to Demonstrates ability to describe Demonstrates some ability to Demonstrates minimal or no ability
Ability to describe and explain the describe and explain the principles and explain the principles behind describe and/or explain the to describe and/or explain the
principles behind and applicability behind and applicability of and applicability of engineering principles behind and applicability principles behind and applicability of
of engineering tools. engineering tools. tools of engineering tools. engineering tools.

Identify and Use IT Tools: Demonstrates skilful ability to identify Demonstrates an ability to identify Demonstrates some ability to Demonstrates minimal or no ability
Ability to identify and use and use the most relevant tools for a and use relevant tools for an identify and use tools for an to identify or use tools for an
computer & related software or range of engineering activities. engineering activity engineering activity, but may not engineering activity
relevant tools for engineering identify the most relevant tool
activity.

Modifying Tools: Demonstrates skilful ability to Demonstrates an ability to create Demonstrates some ability to Demonstrates minimal or no ability
Ability to modify engineering create engineering tools. operations management tools create operations management to create operations management
tools. tools with guidance. tools.

Evaluate Tools: Demonstrates skilful ability to Demonstrates the ability to identify Demonstrates some ability to Demonstrates minimal or no
Ability to identify the limitations in evaluate the limitations of tools and the limitations of tools and identify the limitations of tools and ability to identify the limitations
the use of engineering tools, and discusses the assumptions. understands the assumptions. some understanding of the of tools and understand the
their underlying assumptions. assumptions. assumptions.

Overall percentage score_____________

Is the student’s performance satisfactory in Graduate attribute 2 – Yes/No

Examiner: I KHUMALO Signed Date: 25/05/2022

Moderator: DR. D. JURA Signed Date: 15/06/2022

Moderator: R. STEENKAMP Signed Date: 15/06/2022

EBORE3A GA 5 Assignment 2022-1 Questions Page 4 of 4