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4. (Chapter 3: 10 points). Maser Building constructs custom-built medium-sized houses. The most recent project undertaken by the building contractor requires seven different activities. The
4. (Chapter 3: 10 points). Maser Building constructs custom-built medium-sized houses. The most recent project undertaken by the building contractor requires seven different activities. The building contractor has the following list of relevant activities, their immediate predecessors, and their time estimate. Activity Activity Precedence Time in weeks Cost in Dollars Descriptions relationship Normal Crash Normal Crash time (NU) time (CT) cost (NC) cost (CC) A Design house and None 24 19 3,000 5,000 obtain financing B Lay foundation A 16 12 2,000 3,500 Order and receive A 8 7 4,000 7,000 materials I D Build house B, C 24 20 50,000 71,000 E Select paint 8 5 500 1.100 F Select carpet 8 5 500 1.100 G Finish work D, E, F 8 7 15,000 22,000 For this project, the estimated indirect cost is $1,000 per week. However, after week 60, if the house is not ready, the contractor will pay a penalty of $1,500 per week. For every week that the project duration is shortened - i.e., to 60 weeks -- the contractor saves one week of the penalty and indirect costs, or $2,500. For reduction beyond week 60, the savings are only the weekly indirect costs of $2,500. a) Construct the project network. Calculate the completion time of the project. Identify the activities on the critical path. (2) b) Compute the total allowable crash time per activity and the crash cost per week for each activity. (2) c) What is the total cost required for completing the house in normal time (including the penalty and indirect costs)? (2) d) Suppose that the customer needed the house in 65 weeks and wanted to know how much extra cost would be incurred to complete the house at this time. Crash the project to 65 weeks. Will this increase or decrease the total cost of the project? Would you crash the project to 65 weeks? Why or why not? (2) e) Would you crash the project to 60 weeks if the customer requests to do so? Why or why not? (1) 0 Using the information given in the table and the project completion time in problem 4(a). if task D is delayed by four weeks (not uncommon in practice), how is the project completion time affected! (1)
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