Assignment for Extra Credit: Data Envelopment Analysis Mid-Atlantic Bus Lines was founded by a group of managers from Trailways when that company was acquired by Greyhound. They launched a first-class, express bus service op- erating between the major coastal cities from Philadelphia, Pennsylvania, to Jacksonville, Florida. By hiring laid-off Trailways drivers and leasing buses, they established franchises in each city with local entrepreneurs, who were given the right to operate a Mid-Atlantic bus terminal. A percentage of the passenger ticket sales and freight sales would be kept by the terminal operator to cover his or her costs and profit. After several months of operation, some franchisees complained about inadequate profits and threatened to close their terminals. Because other franchisees were pleased with their experiences, however, a study of all terminal operations in the system was undertaken. The information in the table below was collected over several weeks and represents a typical day's operation. Bus Table 1: Outputs and Inputs for Mid-Atlantic Bus Lines City Ticket Freight Facility Depot Served Sales Sales Labor-Hours Dollars 1 Philadelphia, PA 700 300 40 500 2 Baltimore, MD 300 600 50 500 3 Washington, DC 200 700 50 400 4 Richmond, VA 400 600 50 500 5 Raleigh, NC 500 400 40 400 6 Charleston, SC 500 500 50 500 7 Savannah, GA 800 500 40 600 8 Jacksonville, FL 300 200 30 400 We will use DEA to identify efficient and inefficient terminal operations. Solve above LP programs using computer software such as Excel Solver. Compute the efficiency of each terminal and identify their efficient reference sets if any. Unit Efficiency Reference Set Dual Variable Depot 1 Depot 2 Depot 3 Depot 4 Depot 5 Depot 6 Depot 7 Depot 8 Using the appropriate reference set of efficient terminals, make recommendations for changes in resource inputs for each inefficient terminal. Reference Set Composite Reference Unit Excess Input Used Depot 3 Depot 7 Depot 2 Tickets 300 Freight 600 Labor 50 Facility 500 Reference Set Composite Reference Unit Excess Input Used Depot 3 Depot 5 Depot 7 Depot 4 Tickets 300 600 Freight Labor 50 Facility 500 Reference Set Composite Reference Unit Excess Input Used Depot 3 Depot 5 Depot Depot 6 Tickets 500 500 Freight Labor 50 Facility 500 Reference Set Composite Reference Unit Excess Input Used Depot 5 Depot 7 Depot 8 Tickets 300 200 Freight Labor Facility 30 400 Assignment for Extra Credit: Data Envelopment Analysis Mid-Atlantic Bus Lines was founded by a group of managers from Trailways when that company was acquired by Greyhound. They launched a first-class, express bus service op- erating between the major coastal cities from Philadelphia, Pennsylvania, to Jacksonville, Florida. By hiring laid-off Trailways drivers and leasing buses, they established franchises in each city with local entrepreneurs, who were given the right to operate a Mid-Atlantic bus terminal. A percentage of the passenger ticket sales and freight sales would be kept by the terminal operator to cover his or her costs and profit. After several months of operation, some franchisees complained about inadequate profits and threatened to close their terminals. Because other franchisees were pleased with their experiences, however, a study of all terminal operations in the system was undertaken. The information in the table below was collected over several weeks and represents a typical day's operation. Bus Table 1: Outputs and Inputs for Mid-Atlantic Bus Lines City Ticket Freight Facility Depot Served Sales Sales Labor-Hours Dollars 1 Philadelphia, PA 700 300 40 500 2 Baltimore, MD 300 600 50 500 3 Washington, DC 200 700 50 400 4 Richmond, VA 400 600 50 500 5 Raleigh, NC 500 400 40 400 6 Charleston, SC 500 500 50 500 7 Savannah, GA 800 500 40 600 8 Jacksonville, FL 300 200 30 400 We will use DEA to identify efficient and inefficient terminal operations. Solve above LP programs using computer software such as Excel Solver. Compute the efficiency of each terminal and identify their efficient reference sets if any. Unit Efficiency Reference Set Dual Variable Depot 1 Depot 2 Depot 3 Depot 4 Depot 5 Depot 6 Depot 7 Depot 8 Using the appropriate reference set of efficient terminals, make recommendations for changes in resource inputs for each inefficient terminal. Reference Set Composite Reference Unit Excess Input Used Depot 3 Depot 7 Depot 2 Tickets 300 Freight 600 Labor 50 Facility 500 Reference Set Composite Reference Unit Excess Input Used Depot 3 Depot 5 Depot 7 Depot 4 Tickets 300 600 Freight Labor 50 Facility 500 Reference Set Composite Reference Unit Excess Input Used Depot 3 Depot 5 Depot Depot 6 Tickets 500 500 Freight Labor 50 Facility 500 Reference Set Composite Reference Unit Excess Input Used Depot 5 Depot 7 Depot 8 Tickets 300 200 Freight Labor Facility 30 400