Linear Programming
Predictive Analysis
Linear Programming (LP)
Introduction
► Optimization is an important and fascinating area of management
science and operations research. It helps to do less work, but gain
more.
► Linear programming (LP) is a central topic in optimization. It
provides a powerful tool in modeling many applications. LP has
attracted most of its attention in optimization during the last six
decades for two main reasons:
► Applicability: There are many real world applications that can
be modeled as linear programming;
► Solvability: There are theoretically and practically efficient
techniques for solving large-scale problems.
Basic Components of LP
Each LP problem consists of three elements:
► Decision variables: describe our choices that are under our
control;
► Objective function: describes a criterion that we wish to
minimize (e.g., cost) or maximize (e.g., profit);
► Constraints: describe the limitations that restrict our choices for
decision variables.
Meaning of Linear Programming
► Linear programming is a widely used mathematical modeling
techniques to determine the optimum allocation of scarce
resources among competing demands. Resources typically
include raw materials, manpower, machinery, time, money and
space.
► The technique is very powerful and found especially useful
because of its application to many different types of real business
problems in areas like finance, production, construction and many
more of management.
► As its name implies, the linear programming model consists of
linear objectives and linear constraints, which means that the
variables in a model have a proportionate relationship.
► For example, an increase in manpower resource will result in
an increase in work output
Introduction to Linear Programming
Properties of a Linear Programming Model
► Relationship among decision variables must be linear in nature
► A model must have an objective function
► Resource constraints are essential
► A model must have a non-negativity constraints
Formulation of Linear Programming
Model
Objective Function
► The objective of the problem is identified and converted into a
suitable objective function. The objective function represents the
aim or goal of the system(i.e. decision variables) which has to be
determined from the problem
► Generally, the objective in most cases will be either to maximize
resources or profits or, to minimize the cost or time.
Formulation of Linear Programming
Model
Constraints
► When the availability of resources are in surplus, there will be no
problem in making decisions. But in real life, organizations
normally have scarce resources within which the job has to be
performed in the most effective way. Therefore, problem situations
are within confined limits in which the optimal solution to the
problem must be found.
Non-Negativity Constraint
► Negative values of physical quantities are impossible, like
producing negative number of chairs, tables, etc. so it is necessary
to include the element of non-negativity as a constraint
