QUANTITATIVE TECHNIQUES
FOR BUSINESS
Chap 1-1
Chapter 3
LINEAR PROGRAMMING: THE
SIMPLEX METHOD ALGORITHM
Chap 1-2
Learning Objectives
After completing this chapter, the students will able to:
• Distinguish the difference between simplex method
and graphical method of Linear Programming.
• Introduce the simplex method of Linear Programming.
• Examine in detail the steps of Simplex Method.
• Define and discuss all the elements in the simplex
tableau in terms of their significance to the problem
statement and problem solution.
• Interpret Simplex solutions.
• Discuss unbounded solutions, degeneracy, and
multiple optimal solutions in terms of Simplex Method.
A. General Linear Programming Model
A linear programming problem in n unknowns X1,
X2, X3,…, Xn is one which we are to determine the
maximum or the minimum value of the objective function.
a1X1 + a2X2 + a3 X3 +… + anXn , where a1, a2, a3,…, an are
constant, subject to a linear constraints of the form.
b1X1 + b2X2 + b3X3 +… + bnXn ≤ c or
b1X1 + b2X2 + b3X3 +… + bnXn ≥ c or
b1X1 + b2X2 + b3X3 +… + bnXn = c
where b1, b2, b3 … bn and c are numbers.
B. Standard Linear Programming
Maximization Model
A standard linear programming maximization
model are required to maximize an objective function of
the form
Maximize: P = a1X1 + a2X2 + a3 X3 +… + anXn
Subject to: b1X1 + b2X2 + b3X3 +… + bnXn ≤ c structural
constraints
X1 ≥ 0, X2 ≥ 0, X3 ≥ 0, Xn ≥ 0 non-negative
constraints
Where c > 0 and the inequality in the structural
constraints is strictly “ ≤ ”.
C. Standard Linear Programming
Minimization Model
A standard linear programming minimization
model are required to minimize an objective function of
the form
Minimize: C = a1X1 + a2X2 + a3 X3 +… + anXn
Subject to: b1X1 + b2X2 + b3X3 +… + bnXn ≥ c structural
constraints
X1 ≥ 0, X2 ≥ 0, X3 ≥ 0, Xn ≥ 0 non-negative
constraints
Where c > 0 and the inequality in the structural
constraints is strictly “ ≥ ”.
Standard Linear Programming
Model: Maximization Problem
Steps in Solving Standard LP Maximization Model
using Simplex Method
1. Set up problem in an LP model.
2. Introduce the necessary slack variables.
3. Establish the initial table.
4. Examine the simplex table for optimal solutions. If the
basic feasible solution is maximal, the problem is
solved. Otherwise, proceed to step 5.
5. Compute a new simplex table: select the pivot
column, find pivot column, find pivot row, and pivot
about the pivot entry.
6. Proceed to step 4.
LP Model: Maximization Problem
Example 1:
Determine the basic and non-basic solutions of the LP
model using simplex method.
Maximize: P = 3X1 + 2X2 + X3
Subject to: X1 + X3 15
X2 + 2X3 30
2X1+ X2 40
X1 0, X2 0, X3 0
Maximize: P = 3X1 + 2X2 + X3
Subject to: X1 + X3 15
X2 + 2X3 30
2X1+ X2 40
X1 0, X2 0, X3 0
Let Sn represents the slack variables.
X1 + X 3 + S1 = 15 1st constraint
X2 + 2X3 + S2 = 30 2nd constraint
2X1 + X2 + S3 = 40 3rd constraint
-3X1 - 2X2 - X3 +P =0
TABLE 1
PIVOT ENTRY
P
I BV X1 X2 X3 S1 S2 S3 P RHS TR
V S1 1 0 0 0 15 15
0 1 1
O
T S2 0 1 2 0 1 0 0 30 ∞
R S3 2 1 0 0 0 1 0 40 20
O
W P -3 -2 -1 0 0 0 1 0
PIVOT COLUMN
TABLE 1
𝑻𝑨𝑩𝑳𝑬
TABLE 2
𝑹 𝑹𝑶𝑾
BV X1 X2 X3 S1 S2 S3 P RHS TR
X1 1 0 1 1 0 0 0 15 ∞
S2 0 1 2 0 1 0 0 30 30
𝟐 𝟏
−𝟐 𝑹 𝟏+ 𝑹𝟑 S3 0 1 -2 -2 0 1 0 10 10
𝟐 𝟏
𝟑 𝑹𝟏 +𝑹 𝟒 P 0 -2 2 3 0 0 1 45
TABLE 2
TABLE 3
BV X1 X2 X3 S1 S2 S3 P RHS TR
X1 1 0 1 1 0 0 0 15 15
S2 0 0 4 2 1 -1 0 20 5
3 2 X2
−1 𝑅 + 𝑅
3 2
0 1 -2 -2 0 1 0 10 -5
3 2 P
2 𝑅3 + 𝑅4
0 0 -2 -1 0 2 1 65
TABLE 3
TABLE 4
BV X1 X2 X3 S1 S2 S3 P RHS
4 3 X1
−1 𝑅 + 𝑅
2 1
1 0 0 ½ -1/4 ¼ 0 10
1 3
𝑅 23
X 0 0 1 ½ ¼ -1/4 0 5
4
1
2 𝑅24 + 𝑅 33 X2 0 0 -1 ½ ½ 0 20
4 3 P
2 𝑅2 + 𝑅 4 0 0 0 0 ½ 3/2 1 75
LP Model: Maximization Problem
TABLE 4
BV X1 X2 X3 S1 S2 S3 P RHS
X1 1 0 0 ½ -1/4 ¼ 0 10
X3 0 0 1 ½ ¼ -1/4 0 5
X2 0 1 0 -1 ½ ½ 0 20
P 0 0 0 0 ½ 3/2 1 75
DECISION: X1 = 10 P = 75 S1 = 0
X2 = 20 S2 = 0
X3 = 5 S3 = 0
LP Model: Minimization Problem
Steps in Solving Standard LP Minimization Model
using Simplex Method.
1. Set up problem in an LP model.
2. Introduce the necessary surplus variables.
3. Establish the initial table and put a star in all rows that
give a negative for the associated basic variable.
4. Start with the first starred row and apply the test ratio.
5. Repeat step 4 until no starred row remains.
6. If there are any negative entries in the last row (except
in the RHS column), apply standard maximality test.
LP Model: Minimization Problem
Exercise 2:
Determine the basic and non-basic solutions of the LP
model using simplex method.
Minimize: C = 4X1 + 2X2
Subject to: 5X1 + X2 ≥ 5
5X1 + 3X2 ≥ 10
X1 0, X2 0
LP Model: Minimization Problem
Minimize: C = 4X1 + 2X2
Subject to: 5X1 + X2 ≥ 5
5X1 + 3X2 ≥ 10
X1 0, X2 0
Let Sn represents the surplus variables.
5X1 + X2 - S1 =5 1st constraint
5X1 + 3X2 - S2 = 10 2nd constraint
4X1 + 2X2 + P =0
LP Model: Minimization Problem
TABLE 1
BV X1 X2 S1 S2 P RHS TR
*S1 5 1 -1 0 0 5 1
*S2 5 3 0 -1 0 10 2
P 4 2 0 0 1 0
LP Model: Minimization Problem
TABLE 1
TABLE 2
BV X1 X2 S1 S2 P RHS TR
1 1
𝑅 X1 1 1/5 -1/5 0 0 1 5
52
1
1 5 2.5
−5 𝑅 1 + 𝑅2*S2 0 2 1 -1 0
2 1 P
− 4 𝑅 1 + 𝑅3 0 6/5 4/5 0 1 -4
LP Model: Minimization Problem
TABLE 2
TABLE 3
BV X1 X2 S1 S2 P RHS
1 3 2
− 𝑅2 + 𝑅 1 X
1 1 0 -3/10 1/10 0 ½
51 2
𝑅 X2 0 1 1/2 -1/2 0 5/2
6 23
2
2
− 𝑅2 + 𝑅3 P 0 0 1/5 3/5 1 -7
5
LP Model: Minimization Problem
TABLE 3
BV X1 X2 S1 S2 P RHS
X1 1 0 -3/10 1/10 0 ½
X2 0 1 1/2 -1/2 0 5/2
P 0 0 1/5 3/5 1 -7
DECISION: X1 =1/2 C=7 S1 = 0
X2 = 5/2 S2 = 0
END OF CHAPTER
Chap 1-26
