Assignment 3 BUAD831

Assignment 3 BUAD831
Dr. Rhonda Hyde
Richland Health has three hospitals in the greater Tampa, Florida area. Demand for patient services vary
considerably during the fall and winter months, due to the temporary influx of the aged population. From
October through March, providing adequate nursing staff is extremely difficult for Richland Health. Last year,
to address this problem, Richland Health contracted with Cross Country TravCorp to hire traveling nurses
during these 6 months. TravCorp offered to provide nurses under the following four contract options:
Option Length of Employment Cost
1 One month $2,500
2 Two months $5,800
3 Three months $8,500
4 Four months $12,000
Longer contract periods are more expensive because fewer nurses are willing to commit to longer work
assignments. During the next six months, Richland has projected the following needs for additional nurses.
Month__________________Oct Nov Dec Jan Feb Mar
Temp Nurses Needed 15 28 24 31 25 19
Each month, Richland can hire as many nurses as needed under each of the four options. For instance, if
Richland hires five nurses in October under Option 2, Cross Country TravCorp will supply Richland with five
traveling nurses who will work two months: October and November. For this, Davis must pay 5($5,800) =
$29,000. Richland Health does not want to commit to any contractual obligations for traveling nurses beyond
March. No traveling nurses should be employed past March.
Each nurse hired in the traveling-nurse program must receive training at the time of hire, at a cost to Richland
Health of $875 per hire, regardless of the option under which the nurse is hired. The training program is
required even if the person has worked for Richland Health in the past.
Richland Health needs to know how many traveling nurses to hire in each of the 6 months under each of the 4
contract options so that it can meet its projected demand in each month.
Part 1.
See the posted Excel file under Assignment 3. Use the first worksheet, called ‘Part 1’ to determine a feasible
PROVIDED. NO CREDIT WILL BE GIVEN OTHERWISE. Simply fill in the cells so that Richland Health
has at least the needed coverage in each of the 6 months, then calculate the total cost. Note that some cells are
blocked out because no traveling nurses are to be employed past March. 9 points
Part 2 – a
Use the second worksheet called ‘Part 2 – LP’ to develop a linear programming model to determine the number
of nurses Richland Health should hire each month under each contract option in order to meet the projected
needs at a minimum total cost. (The orange cells will be your variables.) Solve your LP using MS Solver. DO
You’ll need to generate both the answer report and sensitivity report. Solver should automatically generate
separate worksheets for each of these – one with the solution (Answer report) and another with dual prices/RHS
ranges (Sensitivity report). 33 points
Part 2 – b
The current demand for traveling nurses in March is 19. By how much can this demand increase so that the
solution you obtained in Part 2 remains unchanged? If demand does increase to 22 in March, what would be the
new cost? Use the Sensitivity Report to determine your answer; no credit will be granted otherwise. (Put your
answer on the ‘Part 2 – LP’ worksheet.) 5 points
Part 2 – c
What’s the percentage cost savings between the plan you developed in Part 1 and the optimal plan in Part 2-a?
(Put your answer on the ‘Part 2 – LP’ worksheet.) 3 pts
What to Submit : ONE Excel file with 4 worksheets. Worksheets will be called ‘Part 1’, ‘Part 2 – LP’,
‘Answer Report’ and ‘Sensitivity Report’. Solver will automatically generate the last 2 worksheets.
Don’t see the Solver analysis tool in your version of Excel?
1. You may need to add Solver to your copy of Excel. To see if you have Solver, click on ‘Data’, then
Solver should appear under the heading of ‘analysis’. If you do not see Solver there, you must add it.
2. To add Solver, go to ‘File’, then ‘Options’, then ‘Add-ins’. In Excel 2013, you’ll see a box at the
bottom saying ‘Manage – Excel Add-ins’. Click the ‘go’ button beside that. A screen will pop up
where you can check ‘Solver’ – then click ‘OK’. I’m not sure if the process to add Solver is exactly
the same for older versions of Excel.

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