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ACC 229 Linear Programming Concepts and Applications

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ACC 229 Linear Programming Concepts and Applications

Uploaded by

Dianne Mae Leyson
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© © All Rights Reserved
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ACC 229

MANAGEMENT SCIENCE
LESSON 2:
LINEAR PROGRAMMING
OBJECTIVES:
At the end of this lesson, you will be able to:
• Understand Linear Programming and its wide application in real-world
situations
• Design a model for linear programming; and
• Apply and resolve basic problems using linear programming
What is Linear Programming?
• A model that consists of linear relationship representing a firm’s
decision/s, given an objective and resource constraints.

• Linear relationship means the interdependence of one variable (called


the independent variable) and another variable (called the dependent
variable).

• This means a change in the independent variable will affect the


dependent variable.
What is Linear Programming?
• Helps managers determine solutions (i.e. make decisions) for problems
to achieve some objective in which there are constraints. Such as
limited resources or a recipe or perhaps production guidelines.
Applications and Limitations of Linear Programming
Applications Limitations
1. Production of goods which require 1. High reliance on the linear
similar raw materials relationship of variables
2. Sell now or process further 2. Does not consider other unknown
3. “Which to produce; how many to variables and contingencies such
produce” decision-making as losses, shrinkages and wastes
3. Does not consider increases and
decreases of demand
Pizza Vs. Burger
# of units Cost per # of units Cost per
Ingredients required unit Ingredients required unit
Dough 2 pcs. P10.00 Dough 1 pc. P10.00
Meat 3 pcs. P12.00 Meat 1 pc. P12.00
Veggies 1 pc. P7.00 Veggies 2 pcs. P7.00
Cheese 2 pcs. P6.00 Cheese 3 pcs. P6.00

Selling price:
Pizza = P100.00 / unit
Burger = P75.00 / unit
Pizza Vs. Burger
Available resources:
Ingredients # of units available
Dough 23 pcs.
Meat 30 pcs.
Veggies 25 pcs.
Cheese 41 pcs.

How many pizzas and burgers have to be produced and sold to maximize
limited resources?
Observation: in the given activity
• What was our primary objective?
• What were the resources?
• What were the constraints?
• what were our independent variables?
Answer: the number of units requirements per pizza and burger
• what were our dependent variables?
Answer: the number of pizza and burger to be produced
Techniques in Linear Programming
Step 1: Define the decision variables
The number of pizza and burger to produce

Step 2: define the objective function


Maximize profit

Step 3: define the constraints


resources (dough, meat, veggies and cheese) available
Step 1: defining the decision variables
• Decision variables are mathematical symbol that represent levels of
activity

• The decision one has to make in the activity is how many pizza and
burger to produce.
Step 2: defining the objective function
• Objective function is a linear mathematical relationship that describes
the objective of the firm in terms of the decision variables.
• The objective function is always consists of either:
a. Maximizing the profit
b. Minimizing the cost of production
Step 2: defining the objective function
• To derive with the objective function, we must first calculate the profit
per pizza and per burger.
# of units Cost per # of units Cost per
Ingredients required unit Total Cost Ingredients required unit Total Cost

Dough 2 pcs. P10.00 Dough 1 pc. P10.00


Meat 3 pcs. P12.00 Meat 1 pc. P12.00
Veggies 1 pc. P7.00 Veggies 2 pcs. P7.00
Cheese 2 pcs. P6.00 Cheese 3 pcs. P6.00
Total Total
Step 2: defining the objective function
Let:
x = number of pizza to produce
y = number of burgers to produce

Objective function is represented as:


Step 3: defining the constraints
• Constraints are the restrictions or limitations in achieving our
objective, that is to maximize profit and minimize costs.
Ingredients # of units required Ingredients # of units required
Dough 2 pcs. Dough 1 pc.
Meat 3 pcs. Meat 1 pc.
Veggies 1 pc. Veggies 2 pcs.
Cheese 2 pcs. Cheese 3 pcs.

• The available resources we have are the following:


Ingredients # of units available
Dough 23 pcs.
Meat 30 pcs.
Veggies 25 pcs.
Cheese 41 pcs.
Step 3: defining the constraints
• each resources is limited, and we have to utilized most of them
to maximize our profit.
• This can be represented as follows:
Final Restrictions
• The number of pizza (x) and burger (y) must be equal to zero or
any positive number because it is impossible to produce
negative items.
• These restrictions are referred to as non-negativity constraints
and are expressed mathematically as:
The complete linear programming model for this problem can now be
summarized as follows:
Objective Function: Maximize Z = 25x + 21y
subject to (constraints):
(dough) 2x + 1y ≤ 23
(meat) 3x + 1y ≤ 30
(veggies) 1x + 2y ≤ 25
(cheese) 2x + 3y ≤ 41
Final Restriction x ≥ 0 ; y ≥ 0
Solutions:
• We will use two constraints to calculate the possible value of
our x and y
To determine whether the values of x and y are correct, we will test the values
with the constraint equations
(dough) 2x + 1y ≤ 23
(meat) 3x + 1y ≤ 30
(veggies) 1x + 2y ≤ 25
(cheese) 2x + 3y ≤ 41

Objective Function:
Maximize z = 25x + 21y
Summary:
• Linear Programming can be very useful in a lot of ways.
• It can also be resolved using a lot of methods such as graphical
and simplex methods
THANK YOU!
Let’s try this!
Olimars also make two different types of golfing gloves: a regular model and a
professional model. The firm has 115 hours of production time available in its cutting
and sewing department, 150 hours available in its finishing department, 125 hours
available in its packaging and shipping department and 205 hours for delivery
department. The production time requirements and the profit contribution per glove are
given in the following table.
Cutting & Packaging Profit/
Model Sewing Finishing & Shipping Delivery Glove
Regular Model 10 15 5 10 Ᵽ25.00
Professional Model 5 5 10 15 Ᵽ40.00

1. What was the primary objective?


2. What are the constraint?
3. How many gloves of each model should Olimars manufacture in order to maximize
profit?

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