GURU NANAK

KHALSA COLLEGE

A PROJECT ON
QUANTITATIVE METHODS
FOR BUSINESS - II

Prepared By-
Group No 6
Assignment
Problem
Q. A company has 4 machines on which to do 3
jobs. Each job can be assigned to one and only
one machine. The cost of each machine is given
in the following table:
JOBS MACHINES

W X Y Z

A 18 24 28 32

B 8 13 17 19

C 10 15 19 22
SOLUTION:

Step 1: Introduce a dummy row

JOBS MACHINES

W X Y Z

A 18 24 28 32

B 8 13 17 19

C 10 15 19 22

D 0 0 0 0
 Step 2: Subtract each element of
row with the lowest element of
that row
JOBS MACHINES

W X Y Z

A 18 24 28 32

B 8 13 17 19

C 10 15 19 22

D 0 0 0 0
JOBS MACHINES

W X Y Z

A 0 6 10 14

B 0 5 9 11

C 0 5 9 12

D 0 0 0 0
 Step 3: Subtract each element of
column with the lowest element of that
column
JOBS MACHINES

W X Y Z

A 0 6 10 14

B 0 5 9 11

C 0 5 9 12

D 0 0 0 0
JOBS MACHINES

W X Y Z

A 0 6 10 14

B 0 5 9 11

C 0 5 9 12

D 0 0 0 0
 Step 4: Draw minimum number of
lines covering all the zeros.

JOBS MACHINES

W X Y Z

A 0 6 10 14

B 0 9 11
5
C 0 5 9 12

D 0 0 0 0
 Step 5: Number of lines drawn is
less than the order of matrix
JOBS MACHINES

W X Y Z

A 0 1 5 9

B 0 0 4 6

C 0 0 4 7

D 5 0 0 0
 Step 6: Since the number of lines
drawn is equal to the order of matrix
JOBS MACHINES

W X Y Z

A 0 1 1 5

B 0 0 0 2

C 0 0 0 3

D 9 4 0 0
JOBS MACHINES

W X Y Z

A 0 1 1 5

B 0 0 0 2

C 0 0 0 3

D 9 4 0 0
JOBS MACHINES

W X Y Z

A 1 1 5
18

B 0 13 0 2

C 0 0 19 3

D 9 4 0 0
The optimal assignment is -

JOBS MACHINES COST

A W 18

B X 13

C Y 19

TOTAL 50
 Financial
Mathematics - I
Q. Mr. Shahid has Rs. 10,000 and wants
to invest his money for 5 years to earn
higher returns on it. The bank provides
interest at the rate of 10% p.a. He is
given a choice between two types of
interest, which will he choose (where
interest is compounded quarterly)?
SOLUTION:

Here,

Principal (P) = Rs.10,000

Rate of interest(r) = 10% = 0.10

Number of years (n) = 5 years

 In Case of Simple Interest:

Simple Interest = P*n*r

= 10000*5*0.10
= 5000

Amount Realized (A) = Principal + S I

= 10000 + 5000
= 15000

... Amount Realized = Rs. 15,000

 In Case of compound interest:

Number of times interest compounded (m) = 4

... Amount Realized (A) = 10000 (1+0.10)4*5

                        4

    = 10000 (1+0.025) 20

... Amount Realized (A) = 10000 (1.025)20

       Let x = (1.025)20

Taking log on both the sides,

  ... log x = log (1.025)20

    log x = 20.log (1.025)

      log x = 20 (0.0107)
... log x = 0.214
Taking antilog on both the sides,

         antilog (log x) = antilog (0.214)

             ... X = 1.637

    Amount Realized = 10000 * (1.637)

 

... Amount Realized = Rs. 16,370

Type of Principal plus interest
Interest earned
Simple Interest = 10,000 + 5,000
= 15,000
Compound = 10,000 + 6,370
Interest = 16,370
 Q. What effective rate will be
stated if an amount is deposited in a
bank for 1 year which yield an
annual rate of 6% when compounded
semi-annually?
SOLUTION:

Here,

Rate of interest (r) = 6% = 6 = 0.06

100

Number of times interest compounded

(m) = 2

Number of years (n)= 1

Since,

Effective Rate (re) = ( 1+ r )m - 1

... re = (1+0.06/2)2m-1

= (1+0.03)2-1

... re = (1.03)2 -1

= 1.0609 – 1

= 0.0609
 Converting into percentage,

re = 0.0609 * 100

... re = 6.09 %

... The Effective Rate is 6.09%

THANK
YOU