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CH 4

This document contains lecture notes on linear programming from Amoud University. It provides an introduction to linear programming and defines it as a mathematical process used in decision making. It then gives three examples of solving linear programming problems, showing how to identify decision variables, write the objective function and constraints, graph the feasible region, and determine the optimal solution. Finally, it lists five common applications of linear programming in business for production management, personnel management, inventory management, marketing management, and financial management.

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42 views6 pages

CH 4

This document contains lecture notes on linear programming from Amoud University. It provides an introduction to linear programming and defines it as a mathematical process used in decision making. It then gives three examples of solving linear programming problems, showing how to identify decision variables, write the objective function and constraints, graph the feasible region, and determine the optimal solution. Finally, it lists five common applications of linear programming in business for production management, personnel management, inventory management, marketing management, and financial management.

Uploaded by

SamoWadaag Online Business
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 PDF, TXT or read online on Scribd
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AMOUD UNIVERSITY

FACULTY OF COMPUTING & INFORMATICS

DEPARTMENT OF BUSINESS IN INFORMATION TECHNOLOGY

Management Mathematics

LECTURE NOTES

CHAPTER FOUR

LINEAR PROGRAMMING

CLASS: Senior BBIT

SECOND SEMESTER

ACADEMIC YEAR: September, 2020 – July, 2021

LECTURER: Mr. Abdiqani M. Aden (Msc in Research & Analysis; Msc in Pure Mathematics)
Introduction

 Linear programming is a mathematical process that has been developed to help managers in
decision making, it has become one of the most widely used and best known tools of
management science and industrial engineering.
 Linear programming is a branch o mathematics that deals with constrained optimization
problems. The word “optimize” means to find the greatest or least.
 A two variable linear programming problem consists of the following:
1. An objective function that expresses the quantity to be maximized or minimized.
2. A system of constraint linear inequalities whose solution set represents the set of feasible
region (solution region).

Example (1) Production scheduling


A manufacturer of fiberglass camper tops for pick-up trucks makes a compact model and a
regular model. Each compact top requires 5 hours from the fabricating department and 2 hours
from the finishing department. Each regular top requires 4 hours from the fabricating department
and 3 hours from the finishing department. The maximum labor hours available per week in the
fabricating department and finishing department are 200 and 108 respectively. If the company
makes a profit of $40 on each compact top and $50 on each regular top.
a) Identify the decision variables.
b) Write the objective function p.
c) Write the problem constrains and non-negative constrains.
d) Graph the feasible region, identify the corner points and evaluate p at each corner point.
e) How many boards of each type should be manufactured each week to maximize the profit?
f) What is the maximum profit?
Solution
a) let x - be number of compact model produced per week
and y - be number of regular model produced per week
b) Objective function ⟹ P = 40x + 50y
c) Fabricating department ⟹ 5x + 4y ≤ 200
Finishing department ⟹ 2x + 3y ≤ 108
≥0
non-negatives
≥0

Management Mathematics LECTURE NOTES AU 2021 Page 2


d) To graph the feasible (solution) region, find the intercepts of both functions

Corner points of the solution region [(0,0), (40,0), (24,20), (0,36)]


Corner points P = 40x + 50y
(0,0) 40(0) + 50(0)= 0
(40,0) 40(40)+50(0)=1600+0= $1600
(24,20) 40(24)+50(20)=960+1000= $1960
(0,36) 40(0)+50(36)=0+1800= $1800
e) we achieve the maximum weekly profit when produced 24 compact models and 20 regular
models
f) The maximum weekly profit is $1960

Management Mathematics LECTURE NOTES AU 2021 Page 3


Example (2)
Minimize and maximize Z = 5x + 15y subject to
x + 3y ≤ 60
x + y ≥ 10
x–y≤0
x, y ≥ 0
Solution
First find the intercepts (x and y) for each function

The maximum value is 300 and the minimum value is 100

Management Mathematics LECTURE NOTES AU 2021 Page 4


Example (3)
High Quality furniture Ltd. manufactures two products, tables & chairs. Both the products have
to be processed through two machines Ml & M2 the total machine-hours available are: 200 hours
of M1 and 400 hours of M2 respectively. Time in hours required for producing a chair and a table
on both the machines is as follows: Time in Hours
Machine Table Chair
M1 7 4
M2 5 5

Profit from the Sale of table is $40 and that from a chair is $30 determine optimal mix of tables
& chairs so as to maximized the total profit.

Applications of Linear programming for solving Business problems


1. Production Management
LP is applied for determining the optimal allocation of such resources as materials, machines, manpower,
etc. by a firm. It is used to determine the optimal product- mix of the firm to maximize its revenue. It is
also used for product smoothing and assembly line balancing.

2. Personnel Management:
LP technique enables the personnel manager to solve problems relating to recruitment, selection, training,
and deployment of manpower to different departments of the firm. It is also used to determine the
minimum number of employees required in various shifts to meet production schedule within a time
schedule.

3. Inventory Management:
A firm is faced with the problem of inventory management of raw materials and finished products. The
objective function in inventory management is to minimize inventory cost and the constraints are space
and demand for the product. LP technique is used to solve this problem.

4. Marketing Management:
LP technique enables the marketing manager in analyzing the audience coverage of advertising based on
the available media, given the advertising budget as the constraint. It also helps the sales executive of a
firm in finding the shortest route for his tour. With its use, the marketing manager determines the optimal
distribution schedule for transporting the product from different warehouses to various market locations
in such a manner that the total transport cost is the minimum.

Management Mathematics LECTURE NOTES AU 2021 Page 5


5. Financial Management:
The financial manager of a firm, mutual fund, insurance company, bank, etc. uses the LP technique for
the selection of investment portfolio of shares, bonds, etc. so as to maximise return on investment.

…… The End …..

Management Mathematics LECTURE NOTES AU 2021 Page 6

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