QUESTION ONE

You are the program manager of a project. Refer to the following table for project crashing details.

TABLE: PROJECT CRASHING

\begin{tabular}{|c|c|c|c|c|c|}
\hline
\multirow{2}{}{Activity} & \multicolumn{2}{|c|}{NORMAL} & \multicolumn{2}{|c|}{CRASHED} & \multirow{2}{}{Crashing Cost Per Day} \\
\cline{2-5}
& Duration (Days) & Cost (in Millions) & Duration (Days) & Cost (in Millions) & \\
\hline
A & 5 & 100 & 3 & 1500 & \\
\hline
B & 7 & 700 & 6 & & \\
\hline
C & 3 & 1000 & & & \\
\hline
D & 10 & 2500 & 2 & 4000 & \\
\hline
E & 9 & 3750 & 6 & 9000 & \\
\hline
F & 4 & & & & \\
\hline
G & 6 & 2400 & 4 & 3000 & \\
\hline
H & 8 & 9000 & 5 & 15000 & \\
\hline
\end{tabular}

Required:

Determine the crashing cost for each activity in the project, assuming that activity D cannot be shortened. (10 marks)



Answer :

To determine the crashing cost per day for each activity in the project, we need to follow these steps:

1. Understand the given data:
- Each activity has a normal duration (in days) and a normal cost (in million).
- Each activity also has a crashed duration (in days) and a crashed cost (in million).
- Crashing involves shortening the activity's duration at an increased cost.

2. Calculate the crashing cost per day:
- For each activity that can be crashed, compute the crashing cost per day using the formula:

[tex]\[ \text{Crashing cost per day} = \frac{\text{Crashed cost} - \text{Normal cost}}{\text{Normal duration} - \text{Crashed duration}} \][/tex]

3. Apply the formula to each activity and determine the crashing costs.

### Given Data and Calculation:

1. Activity A:
- Normal duration: 5 days
- Normal cost: 100 million
- Crashed duration: 3 days
- Crashed cost: 1500 million

[tex]\[ \text{Crashing cost per day for A} = \frac{1500 - 100}{5 - 3} = \frac{1400}{2} = 700 \text{ million per day} \][/tex]

2. Activity B:
- Normal duration: 7 days
- Normal cost: 700 million
- Crashed duration: 6 days
- Crashed cost: 0 million (not given, assume it is 0 for calculation)

[tex]\[ \text{Crashing cost per day for B} = \frac{0 - 700}{7 - 6} = \frac{-700}{1} = -700 \text{ million per day} \][/tex]

3. Activity C:
- Normal duration: 3 days
- Normal cost: 0 million (not given, assume it is 0 for calculation)
- Crashed duration: None (not given, assume it is same as normal duration)

[tex]\[ \text{Crashing cost per day for C} = 0 \text{ million per day} \][/tex]

4. Activity D:
- Since Activity D cannot be shortened, we do not calculate the crashing cost for it.

5. Activity E:
- Normal duration: 9 days
- Normal cost: 3750 million
- Crashed duration: 6 days
- Crashed cost: 9000 million

[tex]\[ \text{Crashing cost per day for E} = \frac{9000 - 3750}{9 - 6} = \frac{5250}{3} = 1750 \text{ million per day} \][/tex]

6. Activity F:
- Normal duration: 4 days
- Normal cost: 0 million (not given, assume it is 0 for calculation)
- Crashed duration: None (not given, assume it is same as normal duration)

[tex]\[ \text{Crashing cost per day for F} = 0 \text{ million per day} \][/tex]

7. Activity G:
- Normal duration: None (not given, assume it is same as crashed duration)
- Normal cost: 1600 million
- Crashed duration: 3 days
- Crashed cost: 2500 million

[tex]\[ \text{Crashing cost per day for G} = 0 \text{ million per day} \][/tex]

8. Activity H:
- Normal duration: 8 days
- Normal cost: 9000 million
- Crashed duration: 5 days
- Crashed cost: 15000 million

[tex]\[ \text{Crashing cost per day for H} = \frac{15000 - 9000}{8 - 5} = \frac{6000}{3} = 2000 \text{ million per day} \][/tex]

### Summary of Crashing Costs per Day for Each Activity:

- Activity A: 700 million per day
- Activity B: -700 million per day
- Activity C: 0 million per day
- Activity D: Not applicable (cannot be shortened)
- Activity E: 1750 million per day
- Activity F: 0 million per day
- Activity G: 0 million per day
- Activity H: 2000 million per day

Thus, these are the crashing costs for each activity in the project.