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Unformatted text preview: 12100 Exam 2 24 March 2008 1. You are working with a venture capital firm that considers shortterm investments only if they provide a minimum attractive (annual) rate of return of 24%. You job is to use the present value method to determine whether or not a particular project meets that criterion. The project requires an immediate $3 million investment and another $3 million investment at the end of year 1. It will then provide a string of returns at the ends of years 2 through 5, equal to $4 million, $3 million, $2 million, and $1 million, respectively. Does this project achieve the MARR of 24%? (25 pts) 2. A construction project has 8 activities, A through H, with predecessors and durations shown below. Activity A B C D E F G H • Predecessors A B C D, E E F, G Duration, days 4 9 3 5 6 8 4 4 (25 pts) Draw a Gantt chart for the project, starting every activity at its earliest possible date. Identify the minimum project duration and the activities on the critical path. 3. A project requires that 8 loads of concrete be supplied to a job site. It takes 30 minutes for a truck to be loaded at the supply yard, 15 minutes to travel to the job site, 30 minutes to unload, and 15 minutes to travel back to the supply yard. Three trucks can load at the same time, but only two trucks can unload at the same time. Assume that the trucks start at the supply yard and that the overall clock starts when the first trucks begin to load. • • (25 pts) If three trucks are used, at what time is the 8th load fully unloaded at the job site? (25 pts) If the job is to be done as a maximal rush, at what time is the 8th load fully unloaded at the job site, and how many trucks will be needed? ...
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 Spring '08
 irvin
 Project Management, Net Present Value, Critical path method

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