Chapter 2: Linear programming

Source: TaylorIII (2007)

JQP2023 Management Science 1

Chapter Topics
Model Formulation

A Maximization Model Example

Graphical Solutions of Linear Programming Models A Minimization Model Example

Irregular Types of Linear Programming Models

Characteristics of Linear Programming Problems

Chapter 2 - Linear Programming: Model Formulation & Graphical Solution

Linear Programming: An Overview

Objectives of business decisions frequently involve maximizing profit or minimizing costs. Linear programming is an analytical technique in which linear algebraic relationships represent a firms decisions, given a business objective, and resource constraints. Steps in application:
Identify problem as solvable by linear programming.
Formulate a mathematical model of the unstructured problem. Solve the model. Implementation
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Model Components
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 - this function is to be maximized or minimized. Constraints requirements or 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 constraints.
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Summary of Model Formulation Steps

Step 1 : Clearly define the decision variables
Step 2 : Construct the objective function Step 3 : Formulate the constraints

Chapter 2 - Linear Programming: Model Formulation & Graphical Solution

LP Model Formulation A Maximization Example (1 of 3)

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 2 4 3 40 50

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Chapter 2 - Linear Programming: Model Formulation & Graphical Solution

Chapter 2 - Linear Programming: Model Formulation & Graphical Solution

LP Model Formulation A Maximization Example (2 of 3)

Resource Availability: 40 hrs of labor per day 120 lbs of clay

Decision Variables:
Objective Function: Resource Constraints: Non-Negativity Constraints:

x1 = number of bowls to produce per day x2 = number of mugs to produce per day
Maximize Z = $40x1 + $50x2 Where Z = profit per day 1x1 + 2x2 40 hours of labor 4x1 + 3x2 120 pounds of clay x1 0; x2 0
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LP Model Formulation A Maximization Example (3 of 3)

Complete Linear Programming Model:
Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Chapter 2 - Linear Programming: Model Formulation & Graphical Solution

Feasible Solutions
A feasible solution does not violate any of the constraints: Example x1 = 5 bowls x2 = 10 mugs Z = $40x1 + $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

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Infeasible Solutions
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

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Graphical Solution of LP Models

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.

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Coordinate Axes Graphical Solution of Maximization Model (1 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.2 Coordinates for Graphical Analysis

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Labor Constraint Graphical Solution of Maximization Model (2 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.3 Graph of Labor Constraint

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Labor Constraint Area Graphical Solution of Maximization Model (3 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.4 Labor Constraint Area

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Clay Constraint Area Graphical Solution of Maximization Model (4 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.5 Clay Constraint Area

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Both Constraints Graphical Solution of Maximization Model (5 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.6 Graph of Both Model Constraints

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Feasible Solution Area Graphical Solution of Maximization Model (6 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.7 Feasible Solution Area

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Objective Function Solution = $800 Graphical Solution of Maximization Model (7 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.8 Objection Function Line for Z = $800

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Alternative Objective Function Solution Lines Graphical Solution of Maximization Model (8 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.9 Alternative Objective Function Lines

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Optimal Solution Graphical Solution of Maximization Model (9 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.10 Identification of Optimal Solution

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Optimal Solution Coordinates Graphical Solution of Maximization Model (10 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.11 Optimal Solution Coordinates

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Extreme (Corner) Point Solutions Graphical Solution of Maximization Model (11 of 12)

Maximize Z = $40x1 + $50x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.12 Solutions at All Corner Points

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Optimal Solution for New Objective Function Graphical Solution of Maximization Model (12 of 12)

Maximize Z = $70x1 + $20x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0

Figure 2.13 Optimal Solution with Z = 70x1 + 20x2

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Slack Variables

Standard form requires that all constraints be in the form of equations (equalities). A slack variable is added to a constraint (weak inequality) to convert it to an equation (=). A slack variable typically represents an unused resource. A slack variable contributes nothing to the objective function value.

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Linear Programming Model: Standard Form

Max Z = 40x1 + 50x2 + s1 + s2 subject to:1x1 + 2x2 + s1 = 40 4x1 + 3x2 + s2 = 120 x1, x2, s1, s2 0 Where:
x1 = number of bowls x2 = number of mugs s1, s2 are slack variables

Figure 2.14 Solution Points A, B, and C with Slack

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LP Model Formulation A Minimization Example (1 of 7)

Two brands of fertilizer available - Super-Gro, Crop-Quick. Field requires at least 16 pounds of nitrogen and 24 pounds of phosphate. Super-Gro costs $6 per bag, Crop-Quick $3 per bag. Problem: How much of each brand to purchase to minimize total cost of fertilizer given following data ?

Chemical Contribution Brand Super-gro Crop-quick Nitrogen (lb/bag) 2 4

Chapter 2 - Linear Programming: Model Formulation & Graphical Solution

Phosphate (lb/bag) 4 3
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LP Model Formulation A Minimization Example (2 of 7)

Decision Variables: x1 = bags of Super-Gro x2 = bags of Crop-Quick The Objective Function: Minimize Z = $6x1 + 3x2 Where: $6x1 = cost of bags of Super-Gro $3x2 = cost of bags of Crop-Quick Model Constraints: 2x1 + 4x2 16 lb (nitrogen constraint) 4x1 + 3x2 24 lb (phosphate constraint) x1, x2 0 (non-negativity constraint)
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LP Model Formulation and Constraint Graph A Minimization Example (3 of 7)

Minimize Z = $6x1 + $3x2 subject to: 2x1 + 4x2 16 4x1 + 3x2 24 x1, x2 0

Figure 2.16 Graph of Both Model Constraints

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Feasible Solution Area A Minimization Example (4 of 7)

Minimize Z = $6x1 + $3x2 subject to: 2x1 + 4x2 16 4x1 + 3x2 24 x1, x2 0

Figure 2.17 Feasible Solution Area

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Optimal Solution Point A Minimization Example (5 of 7)

Minimize Z = $6x1 + $3x2 subject to: 2x1 + 4x2 16 4x1 + 3x2 24 x1, x2 0

Figure 2.18 Optimum Solution Point

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Surplus Variables A Minimization Example (6 of 7) A surplus variable is subtracted from a constraint to convert it to an equation (=). A surplus variable represents an excess above a constraint requirement level.

Surplus variables contribute nothing to the calculated value of the objective function.
Subtracting slack variables in the farmer problem constraints: 2x1 + 4x2 - s1 = 16 (nitrogen) 4x1 + 3x2 - s2 = 24 (phosphate)
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Graphical Solutions A Minimization Example (7 of 7)

Minimize Z = $6x1 + $3x2 + 0s1 + 0s2 subject to: 2x1 + 4x2 s1 = 16 4x1 + 3x2 s2 = 24 x1, x2, s1, s2 0

Figure 2.19 Graph of Fertilizer Example

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Irregular Types of Linear Programming Problems

For some linear programming models, the general rules do not apply. Special types of problems include those with:
Multiple optimal solutions
Infeasible solutions Unbounded solutions

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Multiple Optimal Solutions Beaver Creek Pottery Example Objective function is parallel to to a constraint line. Maximize Z=$40x1 + 30x2 subject to: 1x1 + 2x2 40 4x1 + 3x2 120 x1, x2 0 Where: x1 = number of bowls x2 = number of mugs
Figure 2.20 Example with Multiple Optimal Solutions
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An Infeasible Problem

Every possible solution violates at least one constraint:

Maximize Z = 5x1 + 3x2 subject to: 4x1 + 2x2 8 x1 4 x2 6 x1, x2 0

Figure 2.21 Graph of an Infeasible Problem

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An Unbounded Problem

Value of objective function increases indefinitely: Maximize Z = 4x1 + 2x2 subject to: x1 4 x2 2 x1, x2 0

Figure 2.22 Graph of an Unbounded Problem

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Characteristics of Linear Programming Problems

A linear programming problem requires a decision - a choice amongst alternative courses of action. The decision is represented in the model by decision variables. The problem encompasses a goal, expressed as an objective function, that the decision maker wants to achieve. Constraints exist that limit the extent of achievement of the objective.

The objective and constraints must be definable by linear mathematical functional relationships.
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Properties of Linear Programming Models

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. Divisibility -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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Problem Statement Example Problem No. 1 (1 of 3)

o Hot dog mixture in 1000-pound batches.

o Two ingredients, chicken ($3/lb) and beef ($5/lb).

o Recipe requirements: at least 500 pounds of chicken

at least 200 pounds of beef

o Ratio of chicken to beef must be at least 2 to 1. o Determine optimal mixture of ingredients that will minimize costs.

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Solution Example Problem No. 1 (2 of 3)

Step 1: Identify decision variables.

x1 = lb of chicken in mixture (1000 lb.)

x2 = lb of beef in mixture (1000 lb.) Step 2:

Formulate the objective function.

Minimize Z = $3x1 + $5x2 where Z = cost per 1,000-lb batch $3x1 = cost of chicken $5x2 = cost of beef
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Solution Example Problem No. 1 (3 of 3)

Step 3: Establish Model Constraints x1 + x2 = 1,000 lb x1 500 lb of chicken x2 200 lb of beef x1/x2 2/1 or x1 - 2x2 0 x1, x2 0 The Model: Minimize Z = $3x1 + 5x2 subject to: x1 + x2 = 1,000 lb x1 500 x2 200 x1 - 2x2 0 x1,x2 0
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Example Problem No. 2 (1 of 3)

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 constraints as equations

Figure 2.23 Constraint Equations

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Chapter 2 - Linear Programming: Model Formulation & Graphical Solution

Example Problem No. 2 (2 of 3)

Maximize Z = 4x1 + 5x2 subject to: x1 + 2x2 10 6x1 + 6x2 36 x1 4 x1, x2 0 Step 2: Determine the feasible solution space

Figure 2.24 Feasible Solution Space and Extreme Points

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Example Problem No. 2 (3 of 3)

Maximize Z = 4x1 + 5x2
subject to: x1 + 2x2 10 6x1 + 6x2 36

x1 4
x1, x2 0 Step 3 and 4: Determine the solution points and optimal solution
Figure 2.25 Optimal Solution Point
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Exercises
1) A wood products firm uses leftover time at the end of each week to make goods for stock. Currently, there are two products on the list of items that are produced or stock: a chopping board and a knife holder. Both items require three operations: cutting, glueing, and finishing. The manager of the firm has collected the following data on these products: The manager has also determined that during each week 56 minutes are available for cutting, 650 minutes for glueing, and 360 minutes for finishing.
Time per unit (min)

Item
Chopping board Knife holder

Profit/U
RM 2 RM 6

Cutting
1.4 0.8

Glueing
5 13

Finishing
12 3

a) Determined the optimal quantities of the decision variable. b) Which resources are not completely used by your solution? How much?

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Exercises 2) Explain why the following linear programming formulation is probably in error:
Min 30x1 + 33x2 S.T: 15x1 + 18x2 90 20x1 + 12x2 120 x 1, x 2 0

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Exercises 3) Explain why the following linear programming problem can not be solved for an optimal solution
Min 7x1 + 3x2 S.T: 6x1 + 8x2 48 4x1 + 3x2 24 x2 5 x 1 , x2 0

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Exercises
4) A company is in process of developing a new product by mixing raw materials A & B where each contains necessary elements E1 & E2 for the new product. 1kg of A contains 2 units of E1 & 2 units of of E2, while 1 kg of B contains 1,3 respectively. Of one box of the new product should contain 20 units of E1 and 24 units of E2, and costs of A & B respectively are RM 4 & RM 3, then how much A & B to use in the production mix?
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Exercises 5) A company produces two types of bike that are in great demand. Bike A needs 2 assembly time hours, and 4 painting time hours. Bike B needs 3,2 respectively. If the assembly hours cant exceed 360 hrs/wk, painting hours cant exceed 400 hrs/wk, profit RM80/bike A and RM 70/bike B, then how many of product A & B should the company produced weekly to maximize profit?
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End of Chapter

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