The Sharon Construction Corporation has been awarded a contract for the construction of a 20,000-seat stadium. The construction starts on Monday, February 15, 2016andmustbe completed within 52 weeks. A penalty clause of $15,000 per week for each full or partial of delay beyond this date was written into the contract. Jim Brown, the president of the company, called a planning meeting. In the meeting he expressed great satisfaction at obtaining the contract and revealed that the company could net as much as $300,000on the project. He was confident that the project could be completed on time with an allowance made for the usual delays anticipated in such a large project. Bonnie Green, the director of personnel, agreed that in a normal year only slight delays might develop due to a shortage of labor. However, she reminded the president that for such a large project, the company would have to use unionized employees and that the construction industry labor agreements were to expire on November 27. Past experience indicated a fifty–fifty chance of a strike. Jim Brown agreed that a strike might cause a problem. Unfortunately, there was no way to change the contract. He inquired about the prospective length of a strike. Bonnie figured that such a strike would last either eight weeks (70 percent chance) or possibly 12 weeks (30 percent chance). Jim was not pleased with these prospects. However, before he had a chance to discuss contingency plans he was interrupted by Jack White, the vice-president for engineering. Jack commented that a colder December than had been assumed was now being predicted. This factor had not been taken into consideration during earlier estimates since previous forecasts called for milder weather. Concrete pouring in December might thus require in one out of every three cases (depending on the temperature) special heating that costs $500 per week. This additional information did not please Jim at all. The chances for delay were mounting. And an overhead expense of $500 per week would be incurred in case of any delay that exceeds the baseline schedule as defined in Appendix. The technical details of the project are given in the appendix to this case. The management team was asked to consider alternatives for coping with the situation. At the end of the week, four proposals were submitted:

Required:
a. Expedite the pouring of seat gallery supports. This would cost $20,000 and cut the duration of the activity to six weeks.
b. Put a double shift on the filling of the field. A cost of $10,000 would result in a five-week time reduction.
c. The roof is very important since it precedes several activities. The use of three shifts and some overtime could cut six weeks off the roofing at an additional cost of only $9,000.
d. Do nothingAppendix: Technical Details of the StadiumThe stadium is an indoor structure with a seating capacity of 20,000.