Linear Programming

Modelling Examples
Chapter Topics

 A Product Mix Example

 A Diet Example
 An Investment Example
 A Marketing Example
 A Transportation Example
 A Blend Example
 A Multiperiod Scheduling Example
 A Data Envelopment Analysis Example
A Product Mix Example
Problem Definition (1 of 8)
Four-product T-shirt/sweatshirt manufacturing company.
■ Must complete production within 72 hours
■ Truck capacity = 1,200 standard sized boxes.
■ Standard size box holds12 T-shirts.
■ One-dozen sweatshirts box is three times size of standard box.
■ $25,000 available for a production run.
■ 500 dozen blank T-shirts and sweatshirts in stock.
■ How many dozens (boxes) of each type of shirt to produce?
A Product Mix Example (2 of 8)

Figure 4.1 Quick-

Screen Shirts
A Product Mix Example
Data (3 of 8)
Resource requirements for the product mix
example.
Processing Cost Profit
Time (hr) ($) ($)
Per dozen per dozen per dozen
Sweatshirt - F 0.10 $36 $90
Sweatshirt – B/ F 0.25 48 125
T-shirt - F 0.08 25 45
T-shirt - B/ F 0.21 35 65
A Product Mix Example
Model Construction (4 of 8)
Decision Variables:
x1 = sweatshirts, front printing
x2 = sweatshirts, back and front printing
x3 = T-shirts, front printing
x4 = T-shirts, back and front printing
Objective Function:
Maximize Z = $90x1 + $125x2 + $45x3 + $65x4
Model Constraints:
0.10x1 + 0.25x2+ 0.08x3 + 0.21x4  72 hr
3x1 + 3x2 + x3 + x4  1,200 boxes
$36x1 + $48x2 + $25x3 + $35x4  $25,000
x1 + x2  500 dozen sweatshirts
x3 + x4  500 dozen T-shirts
A Product Mix Example
Computer Solution with Excel (5 of 8)
Objective
Click on “Data” tab
function
to access Solver

=D7*B14+E7*B15+F7*B16+G7*B17

=J7-H7
These cells have no
effect; added for
“cosmetic”
purposes.
Model formulation
=F11*B16+G11*B17 included on all
Excel files on
Exhibit 4.1 Companion Web
site
A Product Mix Example
Solution with Excel Solver Window (6 of 8)

Includes all
five
constraints.

Exhibit 4.2
A Product Mix Example
Solution with QM for Windows (7 of 8)

Model solution is:

x1=175.56 boxes of front-only sweatshirts
x2=57.78 boxes of front and back sweatshirts Exhibit 4.3
x3 = 500 boxes of front-only t-shirts
Z=$45,522.22 profit
A Product Mix Example
Solution with QM for Windows (8 of 8)

Exhibit 4.4
A Diet Example
Data and Problem Definition (1 of 5)
Breakfast Food Fat Cholesterol Iron Calcium Protein Fiber Cost
Cal (g) (mg) (mg) (mg) (g) (g) ($)
1. Bran cereal (cup) 90 0 0 6 20 3 5 0.18
2. Dry cereal (cup) 110 2 0 4 48 4 2 0.22
3. Oatmeal (cup) 100 2 0 2 12 5 3 0.10
4. Oat bran (cup) 90 2 0 3 8 6 4 0.12
5. Egg 75 5 270 1 30 7 0 0.10
6. Bacon (slice) 35 3 8 0 0 2 0 0.09
7. Orange 65 0 0 1 52 1 1 0.40
8. Milk-2% (cup) 100 4 12 0 250 9 0 0.16
9. Orange juice (cup) 120 0 0 0 3 1 0 0.50
10. Wheat toast (slice) 65 1 0 1 26 3 3 0.07

Breakfast to include at least 420 calories, 5 milligrams of iron,

400 milligrams of calcium, 20 grams of protein, 12 grams of
fiber, and must have no more than 20 grams of fat and 30
milligrams of cholesterol.
A Diet Example
Model Construction – Decision Variables (2 of 5)

x1 = cups of bran cereal

x2 = cups of dry cereal
x3 = cups of oatmeal
x4 = cups of oat bran
x5 = eggs
x6 = slices of bacon
x7 = oranges
x8 = cups of milk
x9 = cups of orange juice
x10 = slices of wheat toast
A Diet Example
Model Summary (3 of 5)
Minimize Z = 0.18x1 + 0.22x2 + 0.10x3 + 0.12x4 + 0.10x5 + 0.09x6
+ 0.40x7 + 0.16x8 + 0.50x9 + 0.07x10
subject to:
90x1 + 110x2 + 100x3 + 90x4 + 75x5 + 35x6 + 65x7
+ 100x8 + 120x9 + 65x10  420 calories
2x2 + 2x3 + 2x4 + 5x5 + 3x6 + 4x8 + x10  20 g fat
270x5 + 8x6 + 12x8  30 mg cholesterol
6x1 + 4x2 + 2x3 + 3x4+ x5 + x7 + x10  5 mg iron
20x1 + 48x2 + 12x3 + 8x4+ 30x5 + 52x7 + 250x8
+ 3x9 + 26x10  400 mg of calcium
3x1 + 4x2 + 5x3 + 6x4 + 7x5 + 2x6 + x7
+ 9x8+ x9 + 3x10 
20 g protein
5x1 + 2x2 + 3x3 + 4x4+ x7 + 3x10  12
A Diet Example
Computer Solution with Excel (4 of 5)

=SUMPRODUCT(C5:C14,F5:F14)
or
=C5*F5+C6*F6+C7*F7+C8*F8+C9*
F9+C10*F10+C11*F11+C12*F12+C
13*F13+C14*F14

Constraint value,
420, typed in cell
F17
=SUMPRODUCT(C5:C14,E5:E14)
Decision or
variable, =C5*E5+C6*E6+C7*E7+C8*E8+C9
C5:C14 *E9+C10*E10+C11*E11+C12*E12
+C13*E13+C14*E14
Exhibit 4.5
A Diet Example
Solution with Excel Solver Window (5 of 5)
Decision
variables;
“servings” in
column C
Constraint for “calories” in column F;
SUMPRODUCT (C5:C14,F5:F14)<420

Exhibit 4.6
An Investment Example
Model Summary (1 of 5)
An investor has $70,000 to divide among several
instruments. Municipal bonds have an 8.5% return, CD’s
a 5% return, t-bills a 6.5% return, and growth stock 13%.

The following guidelines have been established:

1. No more than 20% in municipal bonds
2. Investment in CDs should not exceed the other three
alternatives
3. At least 30% invested in treasury bills and CDs
4. More should be invested in CDs and treasury bills
than in municipal bonds and growth stocks by a ratio
of 1.2 to 1
5. All $70,000 should be invested.
An Investment Example
Model Summary (2 of 5)
Maximize Z = $0.085x1 + 0.05x2 + 0.065 x3+ 0.130x4
subject to:
x1  $14,000
x2 - x1 - x3- x4  0
x2 + x3  $21,000
-1.2x1 + x2 + x3 - 1.2 x4  0
x1 + x2 + x3 + x4 = $70,000
x1 , x 2 , x 3 , x 4  0
where
x1 = amount ($) invested in municipal bonds
x2 = amount ($) invested in certificates of deposit
x3 = amount ($) invested in treasury bills
x4 = amount ($) invested in growth stock fund
An Investment Example
Computer Solution with Excel (3 of 5)
Objective function, Z,
for total return

First
guideline,
=D6*B13

Total investment requirement,

=D10*B13+E10*B14+F10*B15+G10*B16

Exhibit 4.7
An Investment Example
Solution with Excel Solver Window (3 of 4)

Guideline
constraints

Exhibit 4.8
An Investment Example
Sensitivity Report (4 of 4)

Shadow price for the

amount available to
invest

Exhibit 4.9
A Marketing Example
Data and Problem Definition (1 of 7)
Exposure
(people/ad or Cost
commercial)
Television Commercial 20,000 $15,000

Radio Commercial 2,000 6,000

Newspaper Ad 9,000 4,000

 Budget limit $100,000

 Television time for four commercials
 Radio time for 10 commercials
 Newspaper space for 7 ads
 Resources for no more than 15 commercials and/or ads
A Marketing Example
Model Summary (2 of 7)
Maximize Z = 20,000x1 + 12,000x2 + 9,000x3
subject to:
15,000x1 + 6,000x 2+ 4,000x3  100,000
x1  4
x2  10
x3  7
x1 + x2 + x3  15
x1 , x 2 , x 3  0
where
x1 = number of television commercials
x2 = number of radio commercials
x3 = number of newspaper ads
A Marketing Example
Solution with Excel (3 of 7)
Exhibit 4.10

Objective
function

=F6*D6+F7*D7+F8*D8
or
=SUMPRODUCT(D6:D8,F6:F8)
A Marketing Example
Solution with Excel Solver Window (4 of 7)

Includes all five

constraints

Exhibit 4.11
A Marketing Example
Integer Solution with Excel (5 of 7)

Decision variables

Click on “int” for

integer.

Exhibit 4.12
A Marketing Example
Integer Solution with Excel (6 of 7)

Integer
restriction

Exhibit 4.13
A Marketing Example
Integer Solution with Excel (7 of 7)

Better solution—17,000
Integer solution more total exposures—
than rounded-down
solution

Exhibit 4.14
Copyright © 2016 Pearson Education, Inc.
A Transportation Example
Problem Definition and Data (1 of 3)
Warehouse supply of Retail store demand
Television Sets: for television sets:
1 - Cincinnati 300 A - New York 150
2 - Atlanta 200 B - Dallas 250
3 - Pittsburgh 200 C - Detroit 200
Total 700 Total 600
Unit Shipping Costs:

To Store
From Warehouse
A B C
1 $16 $18 $11
2 14 12 13
3 13 15 17
A Transportation Example
Model Summary (2 of 4)
Minimize Z = $16x1A + 18x1B + 11x1C + 14x2A + 12x2B + 13x2C +
13x3A + 15x3B + 17x3C
subject to:
x1A + x1B+ x1C  300
x2A+ x2B + x2C  200
x3A+ x3B + x3C  200
x1A + x2A + x3A = 150
x1B + x2B + x3B = 250
x1C + x2C + x3C = 200
All xij  0
A Transportation Example
Solution with Excel (3 of 4)

=C5+D5+E5
=C5+C6+C7
Exhibit 4.15
A Transportation Example
Solution with Solver Window (4 of 4)

Decision variables

Demand
constraints

Supply constraints

Exhibit 4.16
A Blend Example
Problem Definition and Data (1 of 7)

Maximum Barrels
Component Cost/barrel
Available/day
1 4,500 $12
2 2,700 10
3 3,500 14

Grade Component Specifications Selling Price ($/bbl)

At least 50% of 1
Super $23
Not more than 30% of 2
At least 40% of 1
Premium
Not more than 25% of 3 20
At least 60% of 1
Extra 18
At least 10% of 2
Copyright © 2016 Pearson Education, Inc.
A Blend Example
Problem Statement and Variables (2 of 7)

Determine the optimal mix of the three components in each grade

of motor oil that will maximize profit. Company wants to produce
at least 3,000 barrels of each grade of motor oil.

Decision variables: The quantity of each of the three components

used in each grade of gasoline (9 decision variables); xij = barrels of
component i used in motor oil grade j per day, where i = 1, 2, 3 and j
= s (super), p (premium), and e (extra).
A Blend Example
Problem Statement and Variables (3 of 7)

Blend specification constraint for super, which must

contain 50% of component 1.

x1s Convert to standard form, a linear

0.50 function on the left side and
x1s  x2 s  x3 s
numeric value on the right.

Multiply both sides by the

denominator and collect terms
x1s 0.50( x1s  x2 s  x3 s )
0.5 x1s  0.5 x2 s  0.5 x3 s 0
A Blend Example
Model Summary (4 of 7)
Maximize Z = 11x1s + 13x2s + 9x3s + 8x1p + 10x2p + 6x3p + 6x1e
+ 8x2e + 4x3e
subject to:
x1s + x1p + x1e  4,500 bbl.
x2s + x2p + x2e  2,700 bbl.
x3s + x3p + x3e  3,500 bbl.
0.50x1s - 0.50x2s - 0.50x3s  0
0.70x2s - 0.30x1s - 0.30x3s  0
0.60x1p - 0.40x2p - 0.40x3p  0
0.75x3p - 0.25x1p - 0.25x2p  0
0.40x1e- 0.60x2e- - 0.60x3e  0
0.90x2e - 0.10x1e - 0.10x3e  0
x1s + x2s + x3s  3,000 bbl.
x1p+ x2p + x3p  3,000 bbl. all xij  0
x1e+ x2e + x3e  3,000 bbl.
Copyright © 2016 Pearson Education, Inc.
A Blend Example
Solution with Excel (5 of 7)

=B7+B10+B13

=B7+B8+B9 =0.5*B7-0.5*B8-0.5*B9
Decision variables - B7:B15
Exhibit 4.17
A Blend Example
Solution with Solver Window (6 of 7)

Exhibit 4.18
A Blend Example
Sensitivity Report (7 of 7)

Exhibit 4.19

The shadow price The upper limit for the sensitivity

for component 1 is range for component 1 is
$20. 4500+1700=6200.
A Multiperiod Scheduling Example
Problem Definition and Data (1 of 5)
Production Capacity: 160 computers per week
50 more computers with overtime
Assembly Costs: $190 per computer regular time;
$260 per computer overtime
Inventory Holding Cost: $10/computer per week
Order schedule:
Week Computer Orders
1 105
2 170
3 230
4 180
5 150
6 250
A Multi-Period Scheduling Example
Decision Variables (2 of 5)

Decision Variables:
rj = regular production of computers in week j
(j = 1, 2, …, 6)
oj = overtime production of computers in week j
(j = 1, 2, …, 6)
ij = extra computers carried over as inventory in week j
(j = 1, 2, …, 5)
A Multi-Period Scheduling Example
Model Summary (3 of 5)
Model summary:
Minimize Z = $190(r1 + r2 + r3 + r4 + r5 + r6) + $260(o1+o2
+o3 +o4+o5+o6) + 10(i1 + i2 + i3 + i4 + i5)
subject to:
rj  160 computers in week j (j = 1, 2, 3, 4, 5, 6)
oj  150 computers in week j (j = 1, 2, 3, 4, 5, 6)
r1 + o1 - i1 = 105 week 1
r2 + o2 + i1 - i2 = 170 week 2
r3 + o3 + i2 - i3 = 230 week 3
r4 + o4 + i3 - i4 = 180 week 4
r5 + o5 + i4 - i5 = 150 week 5
r6 + o6 + i5 = 250 week 6
A Multi-Period Scheduling Example
Solution with Excel (4 of 5)

G7-H7

B7+D7+I6; regular
Decision variables for Decision variables for production + overtime
regular production – overtime production – production + inventory
B6:B11 D6:D11 from previous week

Exhibit 4.20
Copyright © 2016 Pearson Education, Inc.
A Multi-Period Scheduling Example
Solution with Solver Window (5 of 5)

Exhibit 4.21
A Data Envelopment Analysis (DEA) Example
Problem Definition (1 of 5)

DEA compares a number of service units of the same type based

on their inputs (resources) and outputs. The result indicates if a
particular unit is less productive, or efficient, than other units.
Elementary school comparison:
Input 1 = teacher to student ratio
Input 2 = supplementary funds/student
Input 3 = average educational level of parents

Output 1 = average reading SOL score

Output 2 = average math SOL score
Output 3 = average history SOL score
A Data Envelopment Analysis (DEA) Example
Problem Data Summary (2 of 5)

Inputs Outputs

School 1 2 3 1 2 3

Alton .06 $260 11.3 86 75 71

Beeks .05 320 10.5 82 72 67

Carey .08 340 12.0 81 79 80

Delancey
.06 460 13.1 81 73 69
A Data Envelopment Analysis (DEA) Example
Decision Variables and Model Summary (3 of 5)
Decision Variables:
xi = a price per unit of each output where i = 1, 2, 3
yi = a price per unit of each input where i = 1, 2, 3
Model Summary:
Maximize Z = 81x1 + 73x2 + 69x3
subject to:
.06 y1 + 460y2 + 13.1y3 = 1
86x1 + 75x2 + 71x3 .06y1 + 260y2 + 11.3y3
82x1 + 72x2 + 67x3  .05y1 + 320y2 + 10.5y3
81x1 + 79x2 + 80x3  .08y1 + 340y2 + 12.0y3
81x1 + 73x2 + 69x3  .06y1 + 460y2 + 13.1y3
xi , y i  0
A Data Envelopment Analysis (DEA) Example
Solution with Excel (4 of 5)

=E8*D12+F8*D13+G8*D14

=B5*B12+C5*B13+D5*B14

Value of outputs, also in cell H8

Exhibit 4.22
A Data Envelopment Analysis (DEA) Example
Solution with Solver Window (5 of 5)

Scaling constraint

Constraint for
outputs < inputs

Exhibit 4.23
Example Problem Solution
Problem Statement and Data (1 of 5)
Canned cat food, Meow Chow; dog food, Bow Chow.
■ Ingredients/week: 600 lb. horse meat; 800 lb. fish; 1000 lb.
cereal.
■ Recipe requirement: Meow Chow at least half fish
Bow Chow at least half horse meat.
■ 2,250 sixteen-ounce cans available each week.
■ Profit /can: Meow Chow $0.80
Bow Chow $0.96.

How many cans of Bow Chow and Meow Chow should be

produced each week in order to maximize profit?
Example Problem Solution
Model Formulation (2 of 5)

Step 1: Define the Decision Variables

xij = ounces of ingredient i in pet food j per week,
where i = h (horse meat), f (fish) and c (cereal),
and j = m (Meow chow) and b (Bow Chow).

Step 2: Formulate the Objective Function

Maximize Z = $0.05(xhm + xfm + xcm) + 0.06(xhb + xfb + xcb)
Example Problem Solution
Model Formulation (3 of 5)
Step 3: Formulate the Model Constraints
Amount of each ingredient available each week:
xhm + xhb  9,600 ounces of horse meat
xfm + xfb  12,800 ounces of fish
xcm + xcb  16,000 ounces of cereal additive
Recipe requirements:
Meow Chow: xfm/(xhm + xfm + xcm)  1/2 or - xhm + xfm- xcm  0

Bow Chow: xhb/(xhb + xfb + xcb)  1/2 or xhb- xfb - xcb  0

Can Content: xhm + xfm + xcm + xhb + xfb+ xcb  36,000 ounces
Example Problem Solution
Model Summary (4 of 5)

Step 4: Model Summary

Maximize Z = $0.05xhm + $0.05xfm + $0.05xcm + $0.06xhb
+ 0.06xfb + 0.06xcb
subject to:
xhm + xhb  9,600 ounces of horse meat
xfm + xfb  12,800 ounces of fish
xcm + xcb  16,000 ounces of cereal additive
- xhm + xfm- xcm  0
xhb- xfb - xcb  0
xhm + xfm + xcm + xhb + xfb+ xcb  36,000 ounces
xij  0
Example Problem Solution
Solution with QM for Windows (5 of 5)

Solution to the Bark’s Pet Food Company problem using QM for Windows

To determine the number of cans of each flavor, we must sum the

ingredient amounts for each and divide by 16 ounces (the size of a can).

xhm+xfm+xcm=0+8,400+8,400=16,800 oz. of Meow Chow

16,800 / 16 = 1,050 cans of Meow Chow