Linear Programming Model Formulation and Graphical Solution MBA
Linear Programming Model Formulation and Graphical Solution MBA
Model Formulation
A Maximization Model Example
Decision variables: mathematical symbols representing levels of activity of a firm. Objective function: a linear mathematical relationship describing an objective of the firm, in terms of decision variables, that is maximized or minimized Constraints: restrictions placed on the firm by the operating environment stated in linear relationships of the decision variables. Parameters: numerical coefficients and constants used in the objective function and constraint equations.
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Product mix problem - Beaver Creek Pottery Company How many bowls and mugs should be produced to maximize profits given labor and materials constraints? Product resource requirements and unit profit:
Product Bowl Mug Resource Requirements Labor Clay Profit (hr/unit) (lb/unit) ($/unit) 1 4 40 2 3 50
Feasible/Infeasible Solutions
A feasible solution does not violate any of the constraints: Example x1= 5 bowls x2= 10 mugs Z = $40 x1 + 50x2= $700 Labor constraint check: 1(5) + 2(10) = 25 < 40 hours, within constraint Clay constraint check: 4(5) + 3(10) = 70 < 120 pounds, within constraint An infeasible solution violates at least one of the constraints: Example x1 = 10 bowls x2 = 20 mugs Z = $1400 Labor constraint check: 1(10) + 2(20) = 50 > 40 hours, violates constraint
Graphical solution is limited to linear programming models containing only two decision variables. (Can be used with three variables but only with great difficulty.) Graphical methods provide visualization of how a solution for a linear programming problem is obtained.
maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x2 0
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maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x2 0
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maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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Z= $800 = $40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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Z=$800, $1200, $1600 = $40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
Alternative objective function lines for profits, Z, of $800, $1,200, and $1,600
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Z= $800 =$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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Graphical Solution of a Maximization Model Optimal Solution for New Objective Function
maximize Z=$40x1 + 50x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x 2 0
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Slack Variables Standard form requires that all constraints be in the form of equations. A slack variable is added to a constraint to convert it to an equation (=). A slack variable represents unused resources. A slack variable contributes nothing to the objective function value.
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maximize Z=$40x1 + 50x2 + 0s1 + 0s2 subject to 1x1 + 2x2 + s1 = 40 4x2 + 3x2 + s2 = 120 x1,x2,s1,s2 = 0 where x1 = number of bowls x2 = number of mugs s1, s2 are slack variables
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minimize Z = $6x1 + 3x2 subject to 2x1 + 4x2 16 lb of nitrogen 4x1 + 3x2 24 lb of phosphate x1, x2 0
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minimize Z = $6x1 + 3x2 + 0s1 + 0s2 subject to 2x1 + 4x2 - s1 = 16 4x1 + 3x2 - s2 = 24 x1, x2, s1, s2 = 0
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For some linear programming models, the general rules do not apply.
Special types of problems include those with: 1. Multiple optimal solutions 2. Infeasible solutions 3. Unbounded solutions
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Objective function is parallel to a constraint line: maximize Z=$40x1 + 30x2 subject to 1x1 + 2x2 40 hours of labor 4x2 + 3x2 120 pounds of clay x1, x2 0 where x1 = number of bowls x2 = number of mugs
Graph of the Beaver Creek Pottery Company example with multiple optimal solutions
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An Infeasible Problem
Every possible solution violates at least one constraint:
x2 6
x1, x2 0
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An Unbounded Problem
Value of objective function increases indefinitely:
An unbounded problem
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Proportionality - The rate of change (slope) of the objective function and constraint equations is constant. Additivity - Terms in the objective function and constraint equations must be additive. Divisability -Decision variables can take on any fractional value and are therefore continuous as opposed to integer in nature. Certainty - Values of all the model parameters are assumed to be known with certainty (non-probabilistic).
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Solve the following model graphically: maximize Z = 4x1 + 5x2 subject to x1 + 2x2 10 6x1 + 6x2 36 x1 4 x1,x2 0 Step 1: Plot the constraint s as equations:
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6x1 + 6x2 36
x1 4 x1,x2 0 Steps 3 and 4:
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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
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0.08 0.21
25 35
45 65
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Model constraints:
0.10x1 + 0.25x2+ 0.08x3 + 0.21x4 72 hr 3x1 + 3x2 + x3 + x4 1,200 boxes $36x1 + 48x2 + 25x3 + 35x4 $25,000
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Breakfast to include at least 420 calaries, 5 milligrams of iron, 400 milligrams of calcium, 20 grams of protein, 12 grams of fiber, and must have no more than 20 grams of fat and 30 milligrams of cholesterol.
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minimize Z =0.18x1 + 0.22x2 + 0.10x3 + 0.12x4 + 0.10x5 + 0.09x6+ 0.40x7 + 0.16x8 + 0.50x9 0.07x10 subject to 90x1 + 110x2 + 100x3 + 90x4 + 75x5 + 35x6 + 65x7 + 100x8 + 120x9 + 65x10 420 2x2 + 2x3 + 2x4 + 5x5 + 3x6 + 4x8 + x10 20
x2 - x1 - x3- x4 0
x2 + x3 21,000 -1.2x1 + x2 + x3 - 1.2 x4 0 x1 + x2 + x3 + x4 = 70,000
x1, x 2, x3, x4 0
where x1 = amount invested in municipal bonds ($) x2 = amount invested in certificates of deposit ($)
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- Budget limit $100,000 - Television time for four commercials - Radio time for 10 commercials
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2- Atlanta
3- Pittsburgh total
200
200 700
B. - Dallas
C. - Detroit total
250
200 600
From Warehouse 1 2 3
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Component 1 2 3
Cost/barrel $12 10 14
Grade
Component Specifications
Super
At least 50% of 1 Not more than 30% of 2 At least 40% of 1 Not more than 25% of 3 At least 60% of 1 At least 10% of 2
$23
Premium
20
Extra
18
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55
5
6
150
250
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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 (j = 1, 2, 3, 4, 5, 6) oj 150 (j = 1, 2, 3, 4, 5, 6) r1 + o1 - i1 105 r2 + o2 + i1 - i2 170 r3 + o3 + i2 - i3 230 r4 + o4 + i3 - i4 180 r5 + o5 + i4 - i5 150 r6 + o6 + i5 250 rj, oj, ij 0
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Delancey
.06
460
13.1
81
73
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A Data Envelopment Analysis (DEA) Example Decision Variables and Model Summary
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, yi 0
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Example Problem Solution Problem Statement and Data - Canned catfood, Meow Chow; dogfood, Bow Chow. - Ingredients/week: 600lb 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?
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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 xhm + xfm + xcm + xhb + xfb+ xcb 36,000 ounces
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Example Problem Solution Model Summary and Solution with QM for Windows
Step 4: Model Summary
maximize Z = $0.05 xhm + 0.05 xfm + 0.05 xcm + 0.06 xhb + 0.06 xfb + 0.06 x 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
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Additional Exercises
Chap 2 - No 36 & 38; page 62; Chap 3 No 8, 9, 10, 17, 19; pg 92; Chap 4 - 20, 21; pg 146 Group assignment: Case Problem Summer Sports Camp at State University
Please try these questions & we will discuss it during our class.
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