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1. George Hank, CEO of Walker Construction has an opportunity to bid on a contract that pays $5500upon completion, but the contract calls for a late performance penalty of $140 per week for each weekthat the project is delayed beyond eight weeks (20 points total). Duration is in weeks.
A. Find the crash cost per week for each activity and record the results in the crash table in the Wordfile. What are the total normal costs for the project (4 pts)?
Activity
Normal Time(NT)
Normal Cost(NC)
Crash Time(CT)
Crash Cost(CC)
Crashable Weeks
(NT) - (CT)
CC/W
(CC-NC)/(NT-CT)
A
1
$300
1-1 = 0
(300-300)/(1-1)= 0
B
3
$400
470
3-1 = 2
(470-400)/(3-1)=35
C
2
350
550
2-1 = 1
(550-350)/(2-1)=200
D
5
4
675
5-4 = 1
(675-550)/(5-4)=125
E
300
375
4-3 = 1
(375-300)/(4-3)=75
F
450
500
2-1= 1
(500-450)/(2-1)=50
G
7
425
525
7-5= 2
(525-425)/(7-5)=50
H
625
4-2= 2
(625-525)/(4-2)=50
I
250
330
3-1= 2
(330-250)/(3-1)=40
J
1-1= 0
B. Which activity would you recommend that Hank crash first, if any (4 pts.)?
C. What project duration will minimize project cost (6 pts.)?
D. What is the maximum profit that Walker can attain for this project (6 pts)?
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