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Anderson15e ch02

The document introduces linear programming as a method for choosing a course of action in decision-making problems involving linear functions. It details the process of formulating a linear programming model, including defining objectives and constraints, and illustrates a maximization problem faced by Par, Inc. The graphical solution procedure is explained, along with the concepts of feasible solutions, optimal solutions, and the use of slack variables.

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0% found this document useful (0 votes)
20 views41 pages

Anderson15e ch02

The document introduces linear programming as a method for choosing a course of action in decision-making problems involving linear functions. It details the process of formulating a linear programming model, including defining objectives and constraints, and illustrates a maximization problem faced by Par, Inc. The graphical solution procedure is explained, along with the concepts of feasible solutions, optimal solutions, and the use of slack variables.

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You are on page 1/ 41

An Introduction to

Anderson Sweeney Williams Camm Cochran Fry Ohlmann

Management
Science, 15e
Quantitative Approaches to
Decision Making

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license distributed with a certain product or service or otherwise on a password-protected website or school-approved learning management system for classroom use.
Chapter 2: An Introduction to Linear Programming

2.1 - A Simple Maximization Problem


2.2 - Graphical Solution Procedure
2.3 - Extreme Points and the Optimal Solution
2.4 - Computer Solution of the Par, Inc., Problem
2.5 - A Simple Minimization Problem
2.6 - Special Cases
2.7 - General Linear Programming Notation

2
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Linear Programming (1 of 2)

• Linear programming has nothing to do with computer


programming.
• The use of the word “programming” here means
“choosing a course of action.”
• Linear programming involves choosing a course of
action when the mathematical model of the problem
contains only linear functions.

3
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Linear Programming (2 of 2)

• The maximization or minimization of some quantity


is the objective in all linear programming problems.
• All LP problems have constraints that limit the
degree to which the objective can be pursued.
• A feasible solution satisfies all the problem's
constraints.
• An optimal solution is a feasible solution that results
in the largest possible objective function value when
maximizing (or smallest when minimizing).
• A graphical solution method can be used to solve a
linear program with two variables.

4
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Guidelines for Model Formulation

Problem formulation or modeling is the process of


translating a verbal statement of a problem into a
mathematical statement.

• Understand the problem thoroughly.


• Describe the objective.
• Describe each constraint.
• Define the decision variables.
• Write the objective in terms of the decision variables.
• Write the constraints in terms of the decision
variables.

5
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A Simple Maximization Problem (1 of 4)

Par, Inc., is a small manufacturer of golf equipment and


supplies whose management has decided to move into the
market for medium- and high-priced golf bags. Par, Inc.’s
distributor has agreed to buy all the golf bags Par, Inc.,
produces over the next three months.
Each golf bag produced will require the following operations:
1. Cutting and dyeing the material
2. Sewing
3. Finishing (inserting umbrella holder, club separators,
etc.)
4. Inspection and packaging

6
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A Simple Maximization Problem (2 of 4)

This production information is summarized in this table:

Production Time (hours)


Department Standard Bag Deluxe Bag
Cutting and Dyeing 7/10 1
Sewing 1/2 5/6
Finishing 1 2/3
Inspection and Packaging 1/10 1/4

7
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A Simple Maximization Problem (3 of 4)

• Par, Inc.’s production is constrained by a limited number of


hours available in each department. The director of
manufacturing estimates that 630 hours for cutting and
dyeing, 600 hours for sewing, 708 hours for finishing, and
135 hours for inspection and packaging will be available
for the production of golf bags during the next three
months.
• The accounting department analyzed the production data
and arrived at prices for both bags that will result in a
profit contribution1 of $10 for every standard bag and $9
for every deluxe bag produced.

8
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A Simple Maximization Problem (4 of 4)

The complete model for the Par, Inc., problem is as follows:


Production Time (hours)
Department Standard Bag Deluxe Bag
Cutting and Dyeing 7/10 1
Sewing 1/2 5/6
Finishing 1 2/3
Inspection and Packaging 1/10 1/4

9
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Graphical Solution Procedure (1 of 5)

Earlier, we saw that the inequality representing the cutting


and dyeing constraint is:

7
S  1D 630
10

To show all solution


points that satisfy this
relationship, we start by
graphing the solution
points satisfying the
constraint as an equality.

10
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Graphical Solution Procedure (2 of 5)

We continue by identifying the solution points satisfying


each of the other three constraints.

11
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Graphical Solution Procedure (3 of 5)

The graph shown identifies the feasible region:

12
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Graphical Solution Procedure (4 of 5)

The optimal solution point is at the intersection of the


cutting and dyeing and the finishing constraint lines.

13
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Graphical Solution Procedure (5 of 5)

The optimal values of the decision variables S and D must


satisfy dyeing and the finishing constraints simultaneously.
7
S  1D 630 Dyeing Constraint
10
2
1S  D 708 Finishing Constraint
3
This system of equations can be solved using substitution.
The exact location of the optimal solution point is S = 540
and D = 252. The optimal production quantities for Par, Inc.,
are 540 standard bags and 252 deluxe bags, with a resulting
profit contribution of 10(540) + 9(252) = $7,668.

14
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Summary of the Graphical Solution Procedure
for Maximization Problems

1. Prepare a graph of the feasible solutions for each of


the constraints.
2. Determine the feasible region that satisfies all the
constraints simultaneously.
3. Draw an objective function line.
4. Move parallel objective function lines toward larger
objective function values without entirely leaving the
feasible region.
5. Any feasible solution on the objective function line
with the largest value is an optimal solution.

15
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Slack and Surplus Variables (1 of 2)

• A linear program in which all the variables are non-


negative and all the constraints are equalities is said
to be in standard form.
• Standard form is attained by adding slack variables
to "less than or equal to" constraints, and by
subtracting surplus variables from "greater than or
equal to" constraints.
• Slack and surplus variables represent the difference
between the left and right sides of the constraints.
• Slack and surplus variables have objective function
coefficients equal to 0.

16
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Slack and Surplus Variables (2 of 2)

The complete solution tells management that the production of


540 standard bags and 252 deluxe bags will require all
available cutting and dyeing time (630 hours) and all available
finishing time (708 hours), while 600 - 480 = 120 hours of
sewing time and 135 - 117 = 18 hours of inspection and
packaging time will remain unused. The 120 hours of unused
sewing time and 18 hours of unused inspection and packaging
time are referred to as slack for the two departments.
Hours Required forS = 540 and
Constraint D = 252 Hours Available Unused Hours
Cutting and Dyeing 7/10(540) + 1(252) = 630 630 0
Sewing 1/2(540) + 5/6(252) = 480 600 120
Finishing 1(540) + 2/3(252) = 708 708 0
Inspection and Packaging 1/10(540) + 1/4(252) = 117 135 18

17
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Slack Variables (1 of 2)

Often slack variables, are added to the formulation of a linear


programming problem to represent the slack, or idle capacity.
Unused capacity makes no contribution to profit; thus, slack
variables have coefficients of zero in the objective function. After
the addition of four slack variables, denoted as , , , and , the
mathematical model of the Par, Inc., problem becomes
Max 10S + 9D + 0 + 0 + 0 + 0

S 1D
s.t.

S D
+ + 1 + + + = 630

1S D
+ + + 1 + + = 600

S D
+ + + + 1 + = 708

S, D, , , , ≥ 0
+ + + + + 1 = 135

18
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Slack Variables (2 of 2)

Referring to the standard form of the Par, Inc., problem, we


see that at the optimal solution (S = 540 and D = 252), the
values for the slack variables are
Constraint Value of Slack Variable
Cutting and Dyeing =0
Sewing = 120
Finishing =0
Inspection and Packaging = 18

On the other hand, the sewing and the inspection and


packaging constraints are not binding the feasible region at the
optimal solution, which means we can expect some unused
time or slack for these two operations.

19
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Extreme Points and the Optimal Solution (1 of 2)

• The corners or vertices of the feasible region are


referred to as the extreme points.
• An optimal solution to an LP problem can be found at
an extreme point of the feasible region.
• When looking for the optimal solution, you do not have
to evaluate all feasible solution points.
• You have to consider only the extreme points of the
feasible region.

20
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Extreme Points and the Optimal Solution (2 of 2)

Here are the 5 extreme points of the feasible region for


the Par, Inc., Problem:

21
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Computer Solutions (1 of 3)

• LP problems involving 1000s of variables and 1000s


of constraints are now routinely solved with computer
packages.
• Linear programming solvers are now part of many
spreadsheet packages, such as Microsoft Excel.
• Leading commercial packages include CPLEX,
LINGO, MOSEK, Xpress-MP, and Premium Solver for
Excel.

22
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Computer Solutions (2 of 3)
Here is a computer solution to the Par, Inc., Problem.
Optimal Objective Value = 7668.00000

Variable Value Reduced Cost


S 540.00000 0.00000
D 252.00000 0.00000

Constraint Slack/Surplus Dual Value


1 0.00000 4.37500
2 120.00000 0.00000
3 0.00000 6.93750
4 18.00000 0.00000

Variable Objective Coefficient Allowable Increase Allowable Decrease


S 10.00000 3.50000 3.70000
D 9.00000 5.28571 2.33333

Constraint RHS Value Allowable Increase Allowable Decrease


1 630.00000 52.36364 134.40000
2 600.00000 Infinite 120.00000
3 708.00000 192.00000 128.00000
4 135.00000 Infinite 18.00000

23
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Computer Solutions (3 of 3)

1. Prepare a graph of the feasible solutions for each of


the constraints.
2. Determine the feasible region that satisfies all the
constraints simultaneously.
3. Draw an objective function line.
4. Move parallel objective function lines toward smaller
objective function values without entirely leaving the
feasible region.
5. Any feasible solution on the objective function line
with the smallest value is an optimal solution.

24
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A Simple Minimization Problem (1 of 6)

M&D Chemicals produces two products that are sold as raw


materials to companies manufacturing bath soaps and laundry
detergents.
• M&D’s management specified that the combined production
for products A and B must total at least 350 gallons.
• A customer ordered 125 gallons of product A.
• Product A requires 2 hours of processing time per gallon.
• Product B requires 1 hour of processing time per gallon.
• 600 hours of processing time are available.
• M&D’s objective is to satisfy these requirements at a
minimum total production cost.
• Production costs are $2 per gallon for product A and $3 per
gallon for product B.

25
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A Simple Minimization Problem (2 of 6)

After adding the nonnegativity constraints (A, B ≥ 0), we arrive


at the following linear program for the M&D Chemicals
problem:

26
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A Simple Minimization Problem (3 of 6)

Here is the feasible region for the M&D Chemicals problem:

Note that the objective


function 2A + 3B = 800
intersects the feasible
region at the extreme
point A = 250, B = 100.

27
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A Simple Minimization Problem (4 of 6)

The optimal solution to the M&D Chemicals problem shows


that the desired total production of A + B = 350 gallons is
achieved by using all processing time: 2A + 1B = 2(250) +
1(100) = 600 hours.
Note that the constraint requiring that product A demand be
met has been satisfied with A = 250 gallons. In fact, the
production of product A exceeds its minimum level by 250 –
125 = 125 gallons.
This excess production for product A is referred to as
surplus.

28
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A Simple Minimization Problem (5 of 6)

Including two surplus variables, S1 and S2, for the ≥


constraints and one slack variable, S3, for the ≤
constraint, the linear programming model of the M&D
Chemicals problem becomes

All the constraints are now equalities.

29
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A Simple Minimization Problem (6 of 6)

At the optimal solution of A = 250 and B = 100, the


values of the surplus and slack variables are as follows:

30
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Computer Solution

Optimal Objective Value = 800.00000

Variable Value Reduced Cost


A 250.00000 0.00000
B 100.00000 0.00000

Constraint Slack/Surplus Dual Value


1 125.00000 0.00000
2 0.00000 4.00000
3 0.00000 –1.00000

Variable Objective Coefficient Allowable Increase Allowable Decrease


A 2.00000 1.00000 Infinite
B 3.00000 Infinite 1.00000

Constraint RHS Value Allowable Increase Allowable Decrease


1 125.00000 125.00000 Infinite
2 350.00000 125.00000 50.00000
3 600.00000 100.00000 125.00000

31
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Feasible Region

• The feasible region for a two-variable LP problem can


be nonexistent, a single point, a line, a polygon, or an
unbounded area.
• Any linear program falls in one of four categories:
• is infeasible
• has a unique optimal solution
• has alternative optimal solutions
• has an objective function that can be increased
without bound
• A feasible region may be unbounded and yet there
may be optimal solutions. This is common in
minimization problems and is possible in maximization
problems.

32
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Special Cases (1 of 5)

Alternative Optimal Solutions


In the graphical method, if the objective function line is
parallel to a boundary constraint in the direction of
optimization, there are alternate optimal solutions,
with all points on this line segment being optimal.

33
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Special Cases (2 of 5)

Let’s return to the Par, Inc., problem. However, now assume


that the profit for the standard golf bag (S) has decreased to
$6.30. The revised objective function becomes 6.3S + 9D.

The objective function


values at these two
extreme points are
identical:
6.3S + 9D =
6.3(300)+9(420) = 5670
and
6.3S + 9D =
6.3(540)+9(252) = 5670

34
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Special Cases (3 of 5)

Furthermore, any point on the line connecting the two


optimal extreme points also provides an optimal solution.
For example, the solution point (S = 420, D = 336),
which is halfway between the two extreme points, also
provides the optimal objective function value of 6.3S +
9D = 6.3(420) + 9(336) = 5670.
A linear programming problem with alternative optimal
solutions is generally a good situation for the manager or
decision maker. It means that several combinations of
the decision variables are optimal and that the manager
can select the most desirable optimal solution.

35
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Special Cases (4 of 5)

Infeasibility
• No solution to the LP problem satisfies all the
constraints, including the non-negativity conditions.
• Graphically, this means a feasible region does not
exist.
• Causes include:
• A formulation error has been made.
• Management’s expectations are too high.
• Too many restrictions have been placed on the
problem (i.e. the problem is over-constrained).

36
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Special Cases (5 of 5)

Unbounded
• The solution to a maximization LP problem is
unbounded if the value of the solution may be
made indefinitely large without violating any of the
constraints.
• For real problems, this is the result of improper
formulation. (Quite likely, a constraint has been
inadvertently omitted.)

37
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General Linear Programming Notation (1 of 3)

We selected decision-variable names of S and D in the


Par, Inc., problem and A and B in the M&D Chemicals
problem to make it easier to recall what these decision
variables represented in the problem.
Although this approach works well for linear programs
involving a small number of decision variables, it can
become difficult when dealing with problems involving a
large number of decision variables.

38
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General Linear Programming Notation (2 of 3)

A more general notation that is often used for linear programs


uses the letter x with a subscript.
In the Par, Inc., problem, we could have defined the decision
variables:
x
1 = number of standard bags

x 2 = number of deluxe bags

In the M&D Chemicals problem, the same variable names


would be used, but their definitions would change:
x 1 = number of gallons of product A
x 2 = number of gallons of product B

39
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General Linear Programming Notation (3 of 3)

A disadvantage of using general notation for decision


variables is that we are no longer able to easily identify
what the decision variables actually represent in the
mathematical model.
The advantage of general notation is that formulating a
mathematical model for a problem that involves a large
number of decision variables is much easier.

40
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End of Presentation: Chapter 2

41
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