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Eric Geriane Bsit 3 Activity 8 A Simple Minimization Problem

M&D Chemicals produces two products, A and B. They aim to minimize total production costs by determining the optimal quantities of each product to make. Their constraints include minimum production levels for each product and a combined minimum, as well as a maximum on total production and processing time. The optimal solution has the processing time and combined minimum production constraints binding, while the minimum for product A is not binding. Increasing the combined minimum by one unit would increase costs by $4, while increasing processing time by one unit would decrease costs by $1.

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Erykk Geriane
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244 views2 pages

Eric Geriane Bsit 3 Activity 8 A Simple Minimization Problem

M&D Chemicals produces two products, A and B. They aim to minimize total production costs by determining the optimal quantities of each product to make. Their constraints include minimum production levels for each product and a combined minimum, as well as a maximum on total production and processing time. The optimal solution has the processing time and combined minimum production constraints binding, while the minimum for product A is not binding. Increasing the combined minimum by one unit would increase costs by $4, while increasing processing time by one unit would decrease costs by $1.

Uploaded by

Erykk Geriane
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Eric Geriane BSIT 3

Activity 8
A Simple Minimization Problem

• M&D Chemicals produces two products that are sold as raw materials to companies
manufacturing bath soaps and laundry detergents.

• Based on the analysis of the current inventory levels and potential demand for the coming
month, M&D’s management specified certain production requirements.

• Production cost: Product A: $2/gallon; Product B: $3/gallon

• Objective: Minimizing the total production cost

Problem Formulation

• To find the minimum-cost production schedule:

• Define the decision variables and the objective function

Let A = number of gallons of product A

B = number of gallons of product B

• Objective function = 2A + 3B

1. Create a linear program for the M&D Chemicals Problem:

Min 2A +3B

Subject To

1A >= 125

1A + 1B >= 350

2A + 1B <= 600

A,B >= 0
2. Create a Solver Answer Report for the M&D Chemicals Problem

3. What would be the optimal solution for the M&D Chemicals Problem

1. The current price of A is 2 and the current price of B is 3. The optimal solution will remain
the same even if the price of A is 3 keeping the B price still same, or if the price of B is 2
keeping A the same.

2. The binding constraints processing time and production of both products have a
Slack/Surplus values of zero. The other non binding constraints have positive/negative
slack values

3. The dual value associated with a constraint is the change in the optimal value of the
solution per unit increase in the right-hand side of the constraint, if I increased the
minimum production constraint from 350 to 351, the cost of production will increase by
$4 and if I could increase the available processing time to 601 hours instead of 600
hours, the cost will decrease by $1

Conclusion:

Both the total production constraint and the processing time constraints are binding. The
requirement that at least 125 gallons of the product a will be produced is not binding. The variable tells
how much over the both side left and right is greater-than-or-equal-to constraint is for a solution. So
therefore M&D Chemicals that produces with two products variable is subtracted from the left-hand
side of the constraint and a positive value for a variable indicates that the constraint is not binding.

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