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    SolvedExercises Ch3 SensitivityAnalysis Questions

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    bilal aamir
    The document provides details on two linear programming problems - one involving maximizing profit from production of four product variants given constraints on assembly, polishing and packing times, and another involving minimizing cost to produce 1000 vehicles across four plants given constraints on labor hours and material units. Sensitivity analyses are presented for both problems, showing how the optimal solutions would change given variations in parameters like costs, profits, resources.

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    SolvedExercises Ch3 SensitivityAnalysis Questions

    Uploaded by

    bilal aamir
    170 views5 pages
    The document provides details on two linear programming problems - one involving maximizing profit from production of four product variants given constraints on assembly, polishing and packing times, and another involving minimizing cost to produce 1000 vehicles across four plants given constraints on labor hours and material units. Sensitivity analyses are presented for both problems, showing how the optimal solutions would change given variations in parameters like costs, profits, resources.

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    The document provides details on two linear programming problems - one involving maximizing profit from production of four product variants given constraints on assembly, polishing and packing times, and another involving minimizing cost to produce 1000 vehicles across four plants given constraints on labor hours and material units. Sensitivity analyses are presented for both problems, showing how the optimal solutions would change given variations in parameters like costs, profits, resources.

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    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    170 views5 pages

    SolvedExercises Ch3 SensitivityAnalysis Questions

    Uploaded by

    bilal aamir
    The document provides details on two linear programming problems - one involving maximizing profit from production of four product variants given constraints on assembly, polishing and packing times, and another involving minimizing cost to produce 1000 vehicles across four plants given constraints on labor hours and material units. Sensitivity analyses are presented for both problems, showing how the optimal solutions would change given variations in parameters like costs, profits, resources.

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    BUS352 – Sensitivity Analysis

    Solved Exercises

    Q1. A company manufactures four variants of the same product and in the final part of the
    manufacturing process there are assembly, polishing and packing operations. For each variant
    the time required for these operations is shown below (in minutes) as is the profit per unit sold.

    Assembly Polish Pack Profit ($)


    Variant 1 2 3 2 1.50
    2 4 2 3 2.50
    3 3 3 2 3.00
    4 7 4 5 4.50
     Given the current state of the labor force the company estimates that, each year, they
    have 100,000 minutes of assembly time, 50,000 minutes of polishing time and 60,000
    minutes of packing time available. How many of each variant should the company make per
    year to maximize its profit?

    Variables

    xi be the number of units of variant i (i=1,2,3,4) made per year

    where xi ≥ 0 for i = 1,2,3,4.

    Objective

    maximize 1.5x1 + 2.5x2 + 3.0x3 + 4.5x4

    Subject to

    2x1 + 4x2 + 3x3 + 7x4 ≤ 100000 (assembly)


    3x1 + 2x2 + 3x3 + 4x4 ≤ 50000 (polish)
    2x1 + 3x2 + 2x3 + 5x4 ≤ 60000 (pack)
    x1, x2, x3, x4 ≥ 0
    Sensitivity Report

    The sensitivity report can be seen below:


    1. What happens to the optimal solution if the profit for variant 2 is not actually 2.5 but
    4?

    2. How much the profit for variant 1 needs to change before it would be profitable to
    produce variant 1?

    3. How much the profit for variant 4 needs to change before it would be profitable to
    produce variant 4?

    4. How much the polish right hand side (RHS) can change without any change in the basic
    variables of the solution?

    5. Will you buy extra working hours for polishing for 60$ (i.e. 1 minute = 1$).

    6. Will you buy extra working hours for polishing for 36 $ (1 minute 0.6$).

    7. If you had an extra 100 hours to which operation would you assign it?

    8. If you had to take 50 hours away from polishing or packing which one would you

    choose?
    QUESTION 2

    Tucker Inc. needs to produce 1000 Tucker automobiles. The company has four production
    plants. Due to differing workforces, technological advances, and so on, the plants differ in the
    cost of producing each car. They also use a different amount of labor and raw material at each.
    This is summarized in the following table:

    The labor contract signed requires at least 400 cars to be produced at plant 3; there are 3300
    hours of labor and 4000 units of material that can be allocated to the four plants.

    Attached is a formulation and computer output for this problem.

    MIN 15 X1 + 10 X2 + 9 X3 + 7 X4
    SUBJECT TO
    2) X1 + X2 + X3 + X4 = 1000
    3) X3 ≥ 400
    4) 2 X1 + 3 X2 + 4 X3 + 5 X4 ≤ 3300
    5) 3 X1 + 4 X2 + 5 X3 + 6 X4 ≤ 4000

    Solution:
    Target Cell (Min)
    Original
    Cell Name Value Final Value
    $C$21 obj 11597.41286 11600

    Adjustable Cells
    Original
    Cell Name Value Final Value
    $B$12 x1 399.9635925 400
    $C$12 x2 199.8287048 200
    $D$1
    2 x3 399.9635468 400
    $E$12 x4 0 0

    Constraints
    Cell Name Cell Value Formula Status Slack
    $F$15   1000 $F$15=$H$15 Not Binding 0
    $F$16   400 $F$16>=$H$16 Binding 0
    $F$17   3000 $F$17<=$H$17 Not Binding 300
    $F$18   4000 $F$18<=$H$18 Binding 0
    Sensitivity Report:

    Adjustable Cells
        Final Reduced Objective Allowable Allowable
    Cell Name Value Cost Coefficient Increase Decrease
    $B$12 x1 400 0 15 1E+30 3.5
    $C$12 x2 200 0 10 2 1E+30
    $D$1
    2 x3 400 0 9 1E+30 4
    $E$12 x4 0 7 7 1E+30 7

    Constraints
        Final Shadow Constraint Allowable Allowable
    Cell Name Value Price R.H. Side Increase Decrease
    $F$15   1000 30 1000 66.66666667 100
    $F$16   400 4 400 100 400
    $F$17   3000 0 3300 1E+30 300
    $F$18   4000 -5 4000 300 200

    Here are some questions to be answered:

    1. What are the current production quantities? What is the current cost of production?
    2. How much will it cost to produce one more vehicle? How much will we save by producing one
    less?

    3. How would our solution change if it cost only 8,000$ to produce at plant 2? For what ranges
    of costs is our solution (except for the objective value) valid for plant 2?

    4. How much are we willing to pay for a labor hour?

    5. How much is our union contract costing us (constraint 2)?

    6. How much is our raw material worth (to get one more unit)?

    7. By how much does plant 4 have to reduce its cost in order for us to consider using it?

    8. By how much can the costs at plant 3 increase before we would not produce there?

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