Chapter 13 Supplement

Linear Programming

Operations Management - 5th Edition

Roberta Russell & Bernard W. Taylor, III

Beni Asllani
Copyright 2006 John Wiley & Sons, Inc. University of Tennessee at Chattanooga
 Lecture Outline

 Model Formulation
 Graphical Solution Method
 Linear Programming Model
 Solution
 Solving Linear Programming Problems
with Excel
 Sensitivity Analysis

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-2

 Linear Programming (LP)

A model consisting of linear relationships

representing a firm’s objective and resource
constraints
LP is a mathematical modeling technique used to
determine a level of operational activity in order to
achieve an objective, subject to restrictions called
constraints

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 Types of LP

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 Types of LP (cont.)

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 Types of LP (cont.)

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 LP Model Formulation

 Decision variables
 mathematical symbols representing levels of activity of an
operation
 Objective function
 a linear relationship reflecting the objective of an operation
 most frequent objective of business firms is to maximize profit
 most frequent objective of individual operational units (such as
a production or packaging department) is to minimize cost
 Constraint
 a linear relationship representing a restriction on decision
making

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-7

 LP Model Formulation (cont.)
Max/min z = c1x1 + c2x2 + ... + cnxn

subject to:
a11x1 + a12x2 + ... + a1nxn (≤, =, ≥) b1
a21x1 + a22x2 + ... + a2nxn (≤, =, ≥) b2
:
am1x1 + am2x2 + ... + amnxn (≤, =, ≥) bm

xj = decision variables
bi = constraint levels
cj = objective function coefficients
aij = constraint coefficients

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-8

 LP Model: Example

RESOURCE REQUIREMENTS
Labor Clay Revenue
PRODUCT (hr/unit) (lb/unit) ($/unit)
Bowl 1 4 40
Mug 2 3 50

There are 40 hours of labor and 120 pounds of clay

available each day

Decision variables
x1 = number of bowls to produce
x2 = number of mugs to produce

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-9

 LP Formulation: Example

Maximize Z = $40 x1 + 50 x2

Subject to
x1 + 2x2 40 hr (labor constraint)
4x1 + 3x2 120 lb (clay constraint)
x1 , x2 0

Solution is x1 = 24 bowls x2 = 8 mugs

Revenue = $1,360

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-10

 Graphical Solution Method

1. Plot model constraint on a set of coordinates

in a plane
2. Identify the feasible solution space on the
graph where all constraints are satisfied
simultaneously
3. Plot objective function to find the point on
boundary of this space that maximizes (or
minimizes) value of objective function

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-11

 Graphical Solution: Example
x2
50 –

40 –
4 x1 + 3 x2 120 lb
30 –

20 – Area common to
both constraints
10 –
x1 + 2 x2 40 hr
0– | | | | | |
10 20 30 40 50 60 x1

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-12

 Computing Optimal Values
x2 x1 + 2x2 = 40
40 –
4x1 + 3x2 = 120
4 x1 + 3 x2 120 lb
4x1 + 8x2 = 160
30 – -4x1 - 3x2 = -120
5x2 = 40
20 –
x1 + 2 x2 40 hr x2 = 8
10 –
8 x1 + 2(8) = 40
0– | | 24 | | x1
x1 = 24
10 20 30 40
Z = $50(24) + $50(8) = $1,360

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-13

 Extreme Corner Points

x1 = 0 bowls
x2 x2 = 20 mugs
x1 = 224 bowls
Z = $1,000
40 – x2 = 8 mugs
Z = $1,360 x1 = 30 bowls
30 – x2 = 0 mugs
20 – A
Z = $1,200

10 –
B
0– | | | C|
10 20 30 40 x1

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-14

 Objective Function
x2
40 –
4x1 + 3x2 120 lb

30 – Z = 70x1 + 20x2
Optimal point:
x1 = 30 bowls
20 –A
x2 = 0 mugs
Z = $2,100
10 – B

x1 + 2x2 40 hr
0– | | | C |
10 20 30 40 x1
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 Minimization Problem

CHEMICAL CONTRIBUTION
Brand Nitrogen (lb/bag) Phosphate (lb/bag)
Gro-plus 2 4
Crop-fast 4 3

Minimize Z = $6x1 + $3x2

subject to
2x1 + 4x2  16 lb of nitrogen
4x1 + 3x2  24 lb of phosphate
x 1, x 2  0

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 Graphical Solution
x2

14 –
x1 = 0 bags of Gro-plus
12 – x = 8 bags of Crop-fast
2

10 –
Z = $24

8–A
Z = 6x1 + 3x2
6–

4–
B
2–
C
0– | | | | | | |
2 4 6 8 10 12 14 x1
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 Simplex Method
 A mathematical procedure for solving linear programming
problems according to a set of steps
 Slack variables added to ≤ constraints to represent unused
resources
 x1 + 2x2 + s1 = 40 hours of labor
 4x1 + 3x2 + s2 = 120 lb of clay
 Surplus variables subtracted from ≥ constraints to represent
excess above resource requirement. For example
 2x1 + 4x2 ≥ 16 is transformed into
 2x1 + 4x2 - s1 = 16
 Slack/surplus variables have a 0 coefficient in the objective
function
 Z = $40x1 + $50x2 + 0s1 + 0s2

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Solution
Points with
Slack
Variables

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Solution
Points with
Surplus
Variables

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 Solving LP Problems with Excel
Click on “Tools”
to invoke “Solver.”

Objective function
=E6-F6

=E7-F7

=C6*B10+D6*B11

=C7*B10+D7*B11

Decision variables – bowls

(x1)=B10; mugs (x2)=B11

Copyright 2006 John Wiley & Sons, Inc. Supplement 13-21

 Solving LP Problems with Excel
(cont.)
After all parameters and constraints
have been input, click on “Solve.”

Objective function

Decision variables

C6*B10+D6*B11≤40
C7*B10+D7*B11≤120

Click on “Add” to
insert constraints

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 Solving LP Problems with Excel
(cont.)

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 Sensitivity Analysis

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 Sensitivity Range for Labor
Hours

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 Sensitivity Range for Bowls

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