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Lab10-LinearOptimization2

The document outlines various linear optimization problems using Excel Solver, including a blending model for paint production, a diet planning example for turkey feed, and an advertising media selection problem. Each problem includes decision variables, constraints, objective functions, and optimal solutions aimed at maximizing profits or minimizing costs. The document serves as a guide for applying linear programming techniques to real-world business scenarios.

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4 views

Lab10-LinearOptimization2

The document outlines various linear optimization problems using Excel Solver, including a blending model for paint production, a diet planning example for turkey feed, and an advertising media selection problem. Each problem includes decision variables, constraints, objective functions, and optimal solutions aimed at maximizing profits or minimizing costs. The document serves as a guide for applying linear programming techniques to real-world business scenarios.

Uploaded by

sujanthraveenthiran3
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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ITIS1P97: Data Analysis and Business Modelling

Lab 10: More on Linear Optimization using Excel Solver

Problem 1 (A Blending Model Example: Mixing Paint)

A company produces both interior and exterior paints from two raw materials, M1 and M2.
Each ton of the exterior paint requires 6 tons of raw material M1 and 1 ton of raw material M2.
Each ton of the interior paint requires 4 tons of raw material M1 and 2 tons of raw material M2.
Maximum daily availability for raw material M1 and M2 is 24 tons and 6 tons, respectively.
The profit per ton of the exterior paint is $5000 and the profit per ton of the interior paint is
$4000. A market survey restricts the maximum daily demand of interior paint to 2 tons.
Additionally, the daily demand for interior paint cannot exceed that of exterior paint by more
than 1 ton. The company wants to determine the optimum (best) product mix of interior and
exterior paints that maximizes the total daily profit. To find the answer, follow these six steps:

a) Define the decision variables.


b) Write down the constraints.
c) Write down the objective function.
d) Show the feasible region.
e) What is the optimum product mix? (That is, what is the optimal solution?)
f) What is the total daily profit? (That is, what is the optimal objective function value?)
xe = daily production (tons) of exterior paint
xi = daily production (tons) of interior paint Decision variables

max 5000 xe + 4000 xi


st. Objective function
6 xe + 4 xi  24
x e + 2 xi  6 Constraints
xi  2
xi  x e + 1
xi  0
xe  0

xi

c d
e Feasible region

a xe
f

Corner point Objective function value


a: (0,0) 0
b: (0,1) 4000 Optimal product mix:
c: (1,2) 13000 xe = 3 tons, xi = 1.5 tons.
d: (2,2) 18000
e: (3,1.5) 21000 As a result of producing 3
f: (4,0) 20000 tons of exterior paint and
1.5 tons of interior paint,
our daily profit will be
$21000.
Problem 2 (Innis Investments Example 13.16: Portfolio (Investment) Selection Models)
Problem 3 (Diet Planning Example)

The Holiday Meal Turkey Ranch is considering buying two different brands of turkey feed (A
and B) and blending them to provide a good, low-cost diet for its turkeys. Each feed contains,
in varying proportions, some or all of the three nutritional ingredients (protein, vitamin, iron)
essential for turkeys.

▪ Each kilogram of brand A contains 5 units of protein, 4 units of vitamin, and 0.5 units of
iron.
▪ Each kilogram of brand B contains 10 units of protein, 3 units of vitamin, but no iron.
▪ The brand A feed costs 2 cents a kilogram, brand B feed costs 3 cents a kilogram.
The following table summarizes the relevant information:

Composition of each kilogram of feed Minimum monthly


(units) requirement per
Ingredient Brand A feed Brand B feed turkey (units)
Protein 5 10 90
Vitamin 4 3 48
Iron 0.5 0 1.5
Cost per kilogram 2 cents 3 cents

The owner of the ranch would like to use LP to determine the lowest-cost diet that meets the
minimum monthly intake requirement for each nutritional ingredient.
Problem 4 (Advertising Media Selection discussed in the lecture)

A firm has budgeted up to $8,000 per week for local advertising. The money is to be allocated
among four promotional media: TV spots, newspaper ads, and two types of radio
advertisements. The firm’s goal is to reach the largest possible audience through the various
media. The following table presents the number of potential customers reached by making use
of an advertisement in each of the four media. It also provides the cost per advertisement placed
and the maximum number of ads that can be purchased per week.

Medium Audience reached Cost per ad ($) Maximum ads per


week
TV spot (1 minute) 5000 800 12
Daily newspaper 8500 925 5
(full-page ad)
Radio spot (30 2400 290 25
seconds, prime time)
Radio spot (1 2800 380 20
minute, afternoon)

The firm’s contractual arrangements require that at least five radio spots to be placed each week.
To ensure a broad-scoped promotional campaign, management also insists that no more than
$1,800 be spent on radio advertising every week.

The decision variables will be defined as follows:

T = number of 1-minute TV spots taken each week


N = number of full-page daily newspaper ads taken each week
P = number of 30-second prime-time radio spots taken each week
A = number of 1-minute afternoon radio spots taken each week

Then, our linear programming model can be written as follows:

Maximize audience coverage = 5000𝑇 + 8500𝑁 + 2400𝑃 + 2800𝐴

subject to

𝑇 ≤ 12 (maximum TV spots per week)


𝑁≤5 (maximum newspaper ads per week)
𝑃 ≤ 25 (maximum 30-second prime-time radio spots per week)
𝐴 ≤ 20 (maximum 1-minute afternoon radio spots per week)
800𝑇 + 925𝑁 + 290𝑃 + 380𝐴 ≤ 8000 (weekly advertising budget)
𝑃+𝐴≥5 (minimum radio spots contracted)
290𝑃 + 380𝐴 ≤ 1800 (maximum dollars spent on radio)
𝑇, 𝑁, 𝑃, 𝐴 ≥ 0

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