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Ch. 3 Linear Programming-1

The document discusses linear programming and provides an example problem to demonstrate how to formulate and solve a linear programming model using the graphic method. Specifically: 1. The example problem involves determining the optimal production quantities of two types of microcomputers to maximize weekly profit given resource constraints. 2. The linear programming model is formulated with the objective function to maximize profit and constraints on assembly time, inspection time, and storage space. 3. The model is solved graphically by plotting the constraint lines and evaluating the objective function at the corner points, identifying the optimal solution at point E with quantities of 9 units of type 1 and 4 units of type 2 computers per week for a maximum profit of $740. 4

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hildamezmur9
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0% found this document useful (0 votes)
42 views

Ch. 3 Linear Programming-1

The document discusses linear programming and provides an example problem to demonstrate how to formulate and solve a linear programming model using the graphic method. Specifically: 1. The example problem involves determining the optimal production quantities of two types of microcomputers to maximize weekly profit given resource constraints. 2. The linear programming model is formulated with the objective function to maximize profit and constraints on assembly time, inspection time, and storage space. 3. The model is solved graphically by plotting the constraint lines and evaluating the objective function at the corner points, identifying the optimal solution at point E with quantities of 9 units of type 1 and 4 units of type 2 computers per week for a maximum profit of $740. 4

Uploaded by

hildamezmur9
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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TOPIC 8: Linear Programming (LP)

Chapter objective: applying the knowledge of LP to solve managerial problems.

I. The Meaning, Structure and Assumptions of LP

Learning objectives: understanding the meaning, components/ structure and


assumptions of LP.

Linear programming: a mathematical and systematic technique for finding or planning the
best use of limited resources to achieve a given goal of maximization or minimization
under certain condition. This is the crucial problem facing most business and decision
makers at every level. It is an allocation model.
Linear programming: is a technique of constrained optimization. Constraints are anything
that affect goal achievement; in LP the major constraint is scarcity of resources.
Optimization is the best way of doing things. It is all about achieving efficiency and
effectiveness. The former refers to being economic, cost saving, avoiding wastage in the
use of resources, while the latter relates to goal achievement. The optimization may
involve maximizing profit, sales, market share and etc. or minimizing cost, time, distance,
space etc.
LPM: mathematical representation of linear programming problems.
LPP: problem (involving resource limitations) where one in tends to know amounts that
help to achieve objectives (max/min)

History
Historically, LPP evolved out of the need to solve problems involving resource allocation by
the U.S. Army during world War II. Among these who looked on such problems was
George Dantzig, who later gave a general formulation of LPP and offered method for
solving it called the simplex method. Since its introduction in 1940s, LP has gained ever
wider acceptance and application. Today airlines, brokerage houses, and oil companies
routinely construct large-scale LPPs involving thousands, even tens of thousands of
variables and constraints.
Components of LPM
1. Objective function: describes mathematically/quantitatively the firm's goal. It is criteria
by which all d/n variables are evaluated.
2. Decision Variables: those factors where a choice could be made. They are manipulated
and are controllable by the decision maker .e.g. Amounts: units sold, number of dollar
invested, number of ad's placed/.
3. Constraints: restrictions which limit the achievability /feasibility of a certain course of
action, it embodies scarce resources: Labor, Raw material, Machine time, Space/storage/,
legal requirement or other limits based on forecasts, customer orders, company policies
etc.
4. Parameters: fixed values that specify the impact that one unit of each decision variable
will have on the objective and on any constraint if pertains to as well as to the numerical
value of each constraint.

Assumptions Underlying LP

1. Proportionality/Linearity: Rates of the decision vairiables in the objective and


constraints function are constant.
2. Divisibility/Continuity: This refers to the values of the decision variables. It is assumed
that non-integer values/fractions are acceptable on some grounds: e.g. 2.5
table/hr=5tables/2 hr.
3. Certainity: All components of the Model and parameters are known with certainty. The
model is deterministic in nature.
4. Finite Choices/ Non- Negativity: Limited number of choices are available to the decision
maker and logically negative values of decision variables are not acceptable.
5. Additivity: There is no interaction among the decision variables (interaction is possible
when, for example, some product is a by-product of another one.) Thus in all the
components of the LPM total of all activities is given by the sum of each activity conducted
separately.
II. Formulating LP Models

Learning Objective: Understanding how to form LPM.

Generally, the problems that we may have to solve using linear programming techniques
are not handed down to us in a ready to solve format. The given information is to be
transformed into the form of equations and inequalities so that linear programming
techniques are applicable.

The main steps in the formulation of LPM are:


1. Define the problem/need/gap
2. Identify the unknowns or decision variables to be determined and assign symbols to
them
3. Identify the objective function of the problem and express it as a linear function of the
decision variable.
4. Identify the restrictions or requirements and express them in the form of linear
relations.
5. Write down the non- negative conditions for the variables.
Once the model is constructed, solve the problem using either the graphic or the simplex
approach and interpret your result.
It should, however, be noted that the formulation of linear programming model is no
science but an art which can be learned only through practice. The procedure for the
formulation of a problem into a LPM is explained through the following examples:
III. Solving Linear Programming model (LPM): Graphic solution method:
Procedure
1. Plot the graph of the constraint functions; identify the common shaded (feasible)
region and the corner points
2. Evaluate the corner points by the objective function and determine (find) the
optimal feasible solution
3. Interpret optimal solution
Example1:Maximization
A firm that assembles computers is about to start production of two microcomputers. Each
type of microcomputer will require assembly time, inspection time, and storage space. The
amount of each of three resources that can be devoted to the production of micro
computers is limited. The manager of the firm would like to determine the quantity of
each microcomputer to produce in order to maximize profit generated by sales of these
microcomputers.
Additional information:
The manager of the firm has obtained the following information from the design and
manufacturing personnel respectively.
Type1 Type2 Resource
Availability
Profit per unit $60 $50 (weekly)
Assembly time 4 hours per unit 10hours per unit 100 hours
Inspection time 2 hours per unit 1hour per unit 22 hours
Storage space 3 cubic feet per unit 3cubic feet per unit 39 cubic feet

(It is confirmed that whatever produced can be sold.) Form the Linear programming
model for the following problem.
Required:
A. Formulate the LPM (show all the necessary steps required to form LPM).
B. Solve it using the graphic approach.
 Determine the number of each type of microcomputers to be made in the
coming week in order for the company to maximize its profit.
 What is the maximum profit?
 At the maximum profit, which resources, if any, are not fully utilized?
C. Interpret your result. (2 points)
Answer
A. Formulate the LPM
Step 1: Problem definition
To determine the number of two types of microcomputers to be produced and sold per
week, so as to maximize the weekly profit given the resource limitations.
Step 2: Variable representation
Let X1 and X2 be the weekly quantities of type 1 and type 2 microcomputers assembled
respectively.

Step 3: Develop the objective function


Maximize or Z max= 60X1+ 50X2

Step 4: Constraint identification


System constraints: 4X1+10X2< 100 hours Assembly
2X1+X2<22 hours Inspection
3X1+3X2<39 cubic feet Storage
Individual constraint................None
Non-negativity constraint.................X1,X2>0

In summary, the mathematical model for the microcomputer problem is :


Zmax: 60X1+50X2
Subject to
4X1+10X2<100
2X1+X2 < 22
3X1+3X2< 39
X1,X2 > 0
B. Solve it using the graphic approach.

Find x and y intercepts for each equation to easily draw respective graphs

1. 4X1+10X2=100 2. 2X1+X2 =22 3. 3X1+3X2= 39


When X1=0 X2=10 When X1=0 X2=22 When X1=0 X2=13

When X2=0 X1=25 When X2=0 X1=11 When X2=0 X1=13


Evaluate corner points by the objective
Corner points 60X1+50X2=Profit
A (0,0) 60(0)+50(0)=0
B (11,0) 60(11)+50(0)=660
C (0,10) 60(0)+50(10)=500
D (5, 8) 60(5)+50(8)=700
E (9,4) 60(9)+50(4)=740
Points A, B, & C can be identified by observation; however, D & E are identified by
solving simultaneously their respective equations.

Region ACDEB is called feasible region


At point E (Graph for equation 2 and 3 intersect)
(2x1 + x2 = 22) x 3
3x1 + 3x2 = 39
6x1 + 3x2 = 66
3x1 + 3x2 = 39
3x1 = 27
x1 = 27/3 = 9
2x1 + x2 = 22 2(9) + x2 = 22
x2 = 22 – 18 = 4
At Point D (Graph for equation 1 and 3 intersect)
(4x1 + 10x2 = 100) x 3
(3x1 + 3x2 = 39) x 4
12x1 + 30x2 = 300
12x1 + 12x2 = 156
18x2 = 144
x2 = 8
3x1 + 3(8) = 39
3x1 = 39 – 24
x1 = 15/3 = 5
Optimal feasible solution:
X1=9, X2=4; Z max.$740 S1=24, S2=0, S3=0

Determine the slack (unused/idle resources at the optimal solution


Originally unused Amount of slack
Amount used available (Available-used)

Assembly 4(9) + 10(4) = 76 100 100 – 76 = 24 hrs


Inspection 2(9) 9+ 1(4) = 22 22 22 – 22 = 0 hr
Storage 3(9) + 3(4) = 39 39 39 – 39 = 0 hr

C. Interpretation: The Company is advised to produce 9 units of type 1 micro


computer and 4 units of type 2 micro computers per week to maximize its profit $
740, and in doing so the company would be left with unused resource of 24
assembly hrs which can be used for other purposes while all other resources are
fully used.

Example 2:
The Indoor Games Company manufactures two products namely: table tennis rackets and
chess sets. Each tennis racket yields a profit per unit of $2 and each chess set profit per
unit of $4. A tennis racket requires four hours of processing time in machine center I and
two hours at Machine center II. A chess set requires six hours at Machine center I, six
hours at Machine center II, and one hour at Machine center III. Machine center I has a
maximum of 120 hours of available capacity per day, while Machine center II has 72 hours
and Machine center III has 10 hours.
Required:
A. Formulate the LPM (show all the necessary steps required to form LPM).
B. Solve it using the graphic approach. (Show all the necessary steps clearly.)
 Determine the number of each product to be made in the coming week in
order for the company to maximize its profit.
 What is the maximum profit?
 At the maximum profit, which resources, if any, are not fully utilized?
C. Interpret your result.
Problem Statement
Determine the optimal amount of the two products namely: table tennis racket and chess
sets to be produced and sold by Indoor Games Company to attain maximum profit given
limitations.
Let x1 be the amount of table tennis rackets to be produced and sold.
Let x2 be the amount of table tennis rackets to be produced and sold.
Z max.: 2x1+4x2
Suject to:
4x1+6x2< 120 hrs ( Processing time in center 1)
2x1+6x2<72 hrs (Processing time in center 2)
x2 < 10 hrs (Processing time in center 3)
x1,x2 > 0
1. 4x1+6x2=120 x1=0 x2=20 x1=30 x2=0
2. 2x1+6x2=72 x1=0 x2=12 x1=36 x2=0
3. X2=10
Evaluate corner points by the objective
Corner points 2X1+4X2=Profit
A (0,0) 2(0)+4(0)=0
B (30,0) 2(30)+4(0)=60
C (0,10) 2(0)+4(10)=40
D (6, 10) 2(6)+4(10)=52
E (24,4) 2(24)+4(4)=64
Points A, B, & C can be identified by observation; however, D & E are identified by
solving simultaneously their respective equations.
Region ACDEB is called feasible region
At point E (Graph for equation 1 and 2intersect)
4x1+6x2=120
2x1+6x2=72
2x1 = 48
X1=48/2 =24
2x1+6x2=72
2(24)+6x2=72
48+6x2=72
6x2=72-48=24
X2=24/6=4

At Point D (Graph for equation 2 and 3 intersect)


2x1+6x2=72 X2=10
2x1+6(10)=72
2x1+60=72
2x1=72-60=12
X1=12/2 =6
Optimal feasible solution:
X1=24, X2=4; Z max.$64 S1=24, S2=0, S3=0

Determine the slack (unused/idle resources at the optimal solution


Originally unused Amount of slack
Amount used available (Available-used)

Machine center I 4(24) + 6(4) = 100 100 100 – 100 = 0 hrs


Machine center II 2(24) + 6(4) = 72 72 22 – 22 = 0 hr
Machine center III X2=4 10 10 – 4= 6 hr
Interpretation : The company is advised to produce and sell 24 units of rackets and 4
units of chess sets in order to maximize its profit to 64 birr in doing so the company will
be left with 6hrs of unused /slack in center 3 while the rest resources will be fully utilized.
Example 3: Minimization
The reclamation agency of Oromia region wants to reclaim lands for two major uses:
urban(non-agricultural) and agricultural. The reclamation of lands for urban purposes
costs 400 birr/acre and for agricultural uses, 300 birr/acres. The reclamation agency is
expected to satisfy the requirements of three groups. The first is an urban group, which
inisists that at least 4000 acres of land be reclaimed for urban purposes. The second
group is concerned with agriculture and says that at least 5000 acres of land must be
reclaimed for agricultural uses. Finally the third group is concerned only with reclamation
and is quite uninterested in the use to which the land will be put rather it says that at
least 10,000 acres of land must be reclaimed. The reclamation agency wants to minimze
the total cost C of reclaiming the land.
Formulate the LPM for this problem
Prob. def.: Determine the amount of land to be reclaimed for agricultural and urban(non-
agricultural purposes) that will minimize cost given the limitations.
 Let x b the number of acres of urban land to be reclaimed
 Let y be the number of acres of agricultural lands to be reclaimed

Zmin.= 400x+300Y
subject to: x>4000 1
y>5000
x+y>10,000
x,y>0
Find x and y intercepts to draw graph
1 X=4000 2. Y=5000 3. X+Y=10,000 X=0 Y=10,000 & Y=0 X=10,000
At point A graphs for equations 1 & 3 intersect
X=4000; X+Y=10000 4000+Y=10000 Y=6000
At point B graphs for equations 2 & 3 intersect
Y=5000; X+Y=10000 X+5000=10000 X=5000

Corner points 400X1+300X2=Profit


A (4000,6000) 400(4000)+300(6000)=3,400,000
B (5000,5000) 400(5000)+300(5000)=3,500,000
A is the minimum.
Optimal feasible solution
X=4000 Y=6000 Zmin.=3,400,000 birr
Interpretation: The land reclamation agency is advised to devote 4000acres to urban
purposes and 6,000 acres to agricultural purposes to attain minim cost of $3,400,000 in
doing so there will be a surplus of 1000 acres of lands to be used for the second group
while the others requirements are exactly satisfied.

Example 4: Mixed signs constraints


The final product of a firm has a requirement that it must weigh exactly 150kg. The two
raw-materials used in the manufacture of this product are Raw material A with a cost of 2
birr per unit and raw material B with a cost of 8 birr per unit. At least 14 units of B and no
more than 20 units of A must be used. Each unit of A weighs 5 kg and each unit of B
weighs 10 kg. How much of each type of raw material should be used for each unit of the
final product if cost is to be minimized?
Problem def. Determine the number of raw materials A & B to be used to produce the
final product with a minimum cost given the requirements.
Let x & y be the number of raw materials A & B to be used respectively
Min. Z: 2x+8y
Subject to:
1. y>14 (R.M A)
2. x<20 (R.M B);
3. 5x+10y=150 (weight)
x,y ≥0 non-negativity constraints

y=14; x=20; 5x+10y=150 x-intercept=30


5(0)+ 10y=150
10y=150
Y=150/10=15 y intercept=15
5x+10(0)=150
5x=150
X=150/5= 30 x-intercept=30
30

3 20
15 B
1
14 A
10

10 20 30 40 50 60
2 3

Corner Points
A= 1&3; Y=14; 5x1+10x2=150 Solution: X=2,Y=14 Z*=116 B=(0,15)
Z=120

The firm is advised to use 2 units of A and 14 units of B to attain a minimize its operating
cost to 116 birr; in doing so 18units of A will be unused while all of B is fully used; in
addition this mix will satisfy the weight requirement of the product to be produced.

Example 5: Maximization General Form (all <): Simplex Algorithm Solution


A company manufactures 3 types of parts which use precious metals platinum and gold.
Due to shortage of these precious metals, the government regulates the amount that may
be used per day. The relevant data with respect to supply, requirements, and profits are
summarized below:
Product Platinum required/Unit Gold required/unit Profit Unit
(gms) (gms) (Br)
A 2 3 500
B 4 2 600
C 6 4 1200
Daily allotment of platinum and gold are 160 gms and 120 gms respectively.
Required: How much should the company produce of each product to optimally utilize
the supply of scarce precious metals and maximize its profit? Solve it using
Simplex A.
Problem Definition: Determine the optimum amount of Product A, B, & C respectively to
be produced and sold to maximize profit given the limited supply of
precious metals.
Linear Programming Model (LPM)

Zmax.:500X1+600X2+1200X3 (Profit)
Subject to
2X1+4X2+6X3=160 (Platinum)
3X1+2X2+4X3=120 (Gold)
X1,X2,X3 ≥0 (non-negativity constraint)

Simplex Algorithm Procedure


Step 1. Standardize Model
Introduce (Sn) Slack variables (if sign in constraint is ≤) with coefficients of 0 in objective;
and with coefficients of +1 in the constraints; represent slack variables in the non-
negativity constraint; change inequality into equal sign

Zmax.:500X1+600X2+1200X3+0S1+0S2
Subject to
2X1+4X2+6X3+1S1=160
3X1+2X2+4X3+1S2=120
X1,X2,X3,S1,S2>0
Step 2. Develop the initial feasible solution tableau
Enter the model parameters into the tableau as follows:
 List decision variables (Xn) and Cj (coefficients) of the objective function across the
top of the tableau
 List aijs of each constraint per row and column respectively in the body of the
tableau
 Likewise list the corresponding RHSV one per row in the last quantity (Q)
column.
 Variables to which the solution in the quantity (RHSV or Bi) column belong are
called Basic variables (BV/Basis); List each slack in the basis column one per row
with its coefficient in the objective function i.e. (0) one per row.
Note: Simplex begins with the Slack variables as basic variables, ìf all the signs in
constraint are ≤. We start with 0 solution to determine the first feasible
solution.
 Compute values for row Zj by summing the product of Cj (coefficients of basic
variables) and Aij (row coefficients of the constraints).
 Compute values for row C-Zj (net evaluation row): subtract Zj values from objective
functions coefficients (Cj)
Initial Feasible Solution Simplex Tableau
500 600 1200 0 0
BV Cj Q
X1 X2 X3 S1 S2
S1 0 2 4 6 1 0 160
S2 0 3 2 4 0 1 120
Zj 0 0 0 0 0
0
Cj-Zj 500 600 1200 0 0

Step 3. Test the optimality of the feasible Solution


Identify the values in row Cj-Zj;
 For maximization: if all are negative and 0 that is the final and optimal tableau,
if not improve the solution. The solution below is therefore not optimal.
 For Minimization if all are positive and 0 i.e. the optimal solution
500 600 1200 0 0
BV Cj X1 X2 X3 S1 S2 Q
S1 0 2 4 6 1 0 160
S2 0 3 2 4 0 1 120
Zj 0 0 0 0 0
0
Cj-Zj 500 600 1200 0 0
Step 4. Improve solution that is not optimal; develop subsequent simplex tableau
(Iteration)
 For maximization, select the variable that has the largest positive value in row
Cj-Zj as the entering variable coming into the solution mix (basis).
For minimization, select variable that shows the highest reduction in row Cj-Zj
as the entering variable; This column of the entering variable is the pivot
column.
 To identify the leaving variable (leaving the solution mix/basis); divide the
values of the pivot column into the corresponding RHSV and select the variable
with the smallest non-negative ratio as the outgoing variable. The row that
belongs to the leaving variable is the pivot row. This is the same for both
maximization & minimization cases. The entry at the intersection of the pivot
row and pivot column is called pivot point.
500 600 1200 0 0
Q Q/x3
BV Cj X1 X2 X3 S1 S2
0 26.67
2 4 6 1 0 160 80/3=
S1 Pivot row
120
0 3 2 4 0 1 120/4= 30
S2
Zj 0 0 0 0 0
0
Cj-Zj 500 600 1200 0 0

Pivot point Pivot column


 Replace the leaving variable and its coefficient with the entering variable and its
coefficient in the basis column. (Calculate the replacement values) for the
leaving variable by dividing each element of the pivot row by the pivot point.
 Let S1 in R1 leave the solution and let X3 enter as a basic variable in its place

Revise R1 (Pivot row): Divide pivot row by pivot point


R1old/6 =Row for S1/6=R1new
X3X1 = 2/6=1/3; X3X2=4/6=2/3; X3X3=6/6=1; X3S1=1/6; X3S2=0/6=0; X3Q=160/6=80/3

 Use elementary row operation to convert all the entries of the pivot column into 0
except the pivot point which is to be changed into unit (1). Use the same
operations to convert the other entries in each row of the new tableau.
Revise R2: i.e. row for S2 -4R1new+R2old=R2new
Cell S2X1 -4(1/3)+3=-4/3+3=5/3
Cell S2X2 -4(2/3)+2=-8/3+2=-2/3
Cell S2X3 -4(1)+ 4=0
Cell S2S1 -4(1/6)+0=-4/6=-2/3
Cell S2S2 -4(0)+1=1
Cell S2Q -4(80/3)+120=-320/3 + 120=40/3
 Calculate the Zj and Cj-Zj values and go to step 3, if the solution is optimal
finish, if not repeat step 4 until you arrive at the optimal feasible solution.
2nd tableau
500 600 1200 0 0
BV Cj X1 X2 X3 S1 S2 Q Q/x1
X3 1200 1/3 2/3 1 1/6 0 80/3 80
S2 0 5/3 - 2/3 0 - 2/3 1 40/3 8 Pivot row
Zj 400 800 1200 200 0 32000
Cj-Zj 100 -200 0 -200 0
Pivot column
Pivot point
Note: All the entries for the basic variables consist of identity 1 & 0s, this is always true,
and so you can save your time by setting the entries of the basic variables into 1 &
0s
 Go back to Step 3 & 4 Test optimality & if solution is not optimal; identify
entering and leaving variables

As the net evaluation row Cj-Zj row has positive value, solution is not optimal; thus to
improve the solution S2 will leave the Basic variables (BVs) and X1 will replace it.
Now revise the tableau that is not optimal by dividing the pivot row by the pivot point just
as in the previous case.

Revise Row 2 (pivot row): Pivot row/pivot point=R2old÷5/3= 3/5R2old =R2new


X1X1 = 3/5*5/3=1; X1X2=3/5*-2/3=-5/3; X1X3=0*3/5=0; X1S1=3/5*-
2/3=-2/5; X1S2=3/5*1=3/5; X1Q=3/5*40/3=8

Revise Row 1 (Row for X3) -1/3R2new+R1old


Cell X3X1 -1/3(1)+1/3=-0
Cell X3X2 -1/3(-2/5)+2/3=2/15+2/3=12/15=4/5
Cell X3X3 -1/3(0)+ 1=1
Cell X3S1 -1/3(-2/5)+1/6=2/15+1/6=27/90=3/10
Cell X3S2 -1/3(3/5)+0=-1/5
Cell X3Q -1/3(8)+80/3=72/3=24

Optimal Tableau (3rd tableau)


500 600 1200 0 0
BV Cj X1 X2 X3 S1 S2 Q
X3 1200 0 4/5 1 3/10 - 1/5 24
X1 500 1 - 2/5 0 - 2/5 3/5 8
Zj 500 760 1200 160 60 32800
Cj-Zj 0 -160 0 -160 -60
 Repeat Step 3 test optimality: All values of the net row (Cj-Zj) consist of
negative and zero values therefore as this is maximization problem optimality is
reached; list optimal feasible solution

Optimal Feasible Solution= X3=24, X1=8, X2=0, S1=0, S2=0; Zmax.=32,800


Interpretation: The company is advised to produce and sell 8 units of A, 24 units of C
and no units of B to get a maximum profit of 32,800 birr. In doing so, all resources are
fully used.
I. Review Exercise:
1. An electronics firm produces three types of switching devices. Each type involves two-
step assembly operation. Assembly time per unit (minutes) is as follows

Station 1 Station2
Model A 2.5 3.0
Model B 1.8 1.6
Model C 2.0 2.2
Each work station has a daily working time of 7.5hours. The manager wants to obtain the
greatest possible profit during the next five working days. Model A yields a profit of Br.
8.25 per unit. Model B a profit of Br. 7.5 per unit and model C a profit of Br. 7.80 per unit.
Assume the firm can sell all it produces. During this time, it must fill outstanding orders for
at least 20 units of each model type.
Formulate the LPM:
Prob. def: Determine the number of 3 types of switching devices to be produced and sold
for the next 5 days (working) to as to maximize 5 days profit.
Let x1,x2,x3 be the number of model A, B, C switching devices to be produced and sold.
Summary
Zmax: 8.25x1+7.5X2+7.8X3
Subject to:
2.5x1+1.8x2+2.0x3 <450 min. Assembly time station 1
3.0x1+1.6x2+2.2x3 < 450 Assembly time station 2
x1≥20, x2≥20, x≥20 Model A, B, C order (demand)
x1,x2,x3≥0 non-negativity constraints

2. A dealer wishes to purchase certain number of fans and sewing machines. He has only
5760 birr to invest and has a space for at the most 20 items. A fan costs him 360 birr
and a sewing machine 240 birr. His expectation is that he can sell a fan at a profit of 22
birr and a sewing machine at a profit of 18 birr. Assuming that he can sell all the items
that the buys, how should he invest his money in order to maximize his profit.
 Formulate the LPM (show all the necessary steps required to form LPM).
 Solve the LPM using graph
o Determine the number of each product to be made in the coming week in
order for the company to maximize its profit.
o What is the maximum profit?
o At the maximum profit, which resources, if any, are not fully utilized?
 Interpret result
Solution:
The dealer is advised to buy 8 fans and 12 sewing machines in order to maximize his
profit to 392 birr in doing so all resources will be fully utilized.
3. Two machines ( I and II) produce two grades of Tires, A and B. In one hour of
operations machine I produce 20 units of grade A and 10 units of grade B Tires, while
machine II produce 30 units of grade A and 40 units of grade B Tires. The machines
are required to meet a production schedule of at least 1400 units of grade A and 1200
units of grade B Tires. The cost of operating machine I is $50 per hour and the cost of
operating machine II is $80 per hour. if the objective is to minimize the cost of
operating the machines;
Solution: in order to Minimize costs of operating the Machines; M I  Has to produce 40
tires; M II  has to produce 20 tires; Z min = 3600
4. Attempt the question on page 76 of your module
Solution:
The company is advised to produce 24 units of push type mower and 40 units of self-
propelled mowers so as to realize a profit of Br. 4020. in doing so, the company would be
left with unused resource of engine which can be used for other purposes.

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