DMO Class Proceedings

Date- 27/01/2015
Section-A
Group no-7
Members- Gaurav Srivastava - 14053
Rijusmitha Devi
Swaroop G

- 14119
- 14167

Today, we have solved two questions in class which basically covers

concepts and understanding of sensitivity analysis.
What is Sensitivity Analysis?
It allows us to determine how sensitive the optimal solution is to changes in data values.
The linear programming approach to optimization problems includes the assumption that
input data is known and is not subject to changes. In real life this assumption may be found
inaccurate. So, a question about the sensitivity of the optimal solution to changes in input
parameters is valid, and important for the sake of making informed decision making.

What is Answer Report?

The Answer Report, which is available whenever a solution has been found, provides basic
information about the decision variables and constraints in the model. It also gives you a
quick way to determine which constraints are binding or satisfied with equality at the
solution, and which constraints have slack.

What is Limits Report?

The Limits Report provides a specialized kind of sensitivity analysis information. It is
created by re-running the Solver model with each decision variable in turn as the objective
(both maximizing and minimizing), and all other variables held fixed. Hence, it shows a
lower limit for each variable, which is the smallest value that a variable can take while
satisfying the constraints and holding all of the other variables constant, and an upper limit,
which is the largest value the variable can take under these circumstances.
Question 1: A ship has two cargo holds, one fore and one aft. The fore cargo hold has a
weight capacity of 70,000 pounds and a volume capacity of 30,000 cubic feet. The aft
hold has a weight capacity of 90,000 pounds and a volume capacity of 40,000 cubic feet.
The ship owner has contracted to carry loads of packaged beef and grain. The total
weight of the available beef is 85,000 pounds; the total weight of the available grain is
100,000 pounds. The volume per mass of the beef is 0.2 cubic foot per pound, and the
volume per mass of the grain is 0.4 cubic foot per pound. The profit for shipping beef is
$0.35 per pound, and the profit for shipping grain is $0.12 per pound. The ship owner is
free to accept all or part of the available cargo; he wants to know how much meat and
grain to accept to maximize profit.

a) How do you define the variables?

b) Formulate a linear programming model for this problem.
c) Solve the model using Excel.
Answers:
A) We have two deciding factors for the profit of Cargo, First, Cargo Holds i.e. Fore and aft
and Quantity of Beef and Grain taken from those Cargos.
So, Variables discovered are
1. Quantity of Beef in Fore- X1
2. Quantity of Beef in aft- X2
3. Quantity of Grain in Fore- X3
4. Quantity of Grain in Aft- X4
B) Linear Programming Model:
Objective Function: 0.35X1+0.35X2+0.12X3+0.12X4
Subject to
Constraint:
1. Fore Weight Capacity ---------- X1+X3 <= 70,000
2. Aft Weight Capacity------------- X2+X4 <= 90000
3. Volume capacity of Fore------- 0.2X1+0.4X3<= 30000
4. Volume capacity of aft-------- 0.2X2+ 0.4 X4 <= 40000
5. Maximum Beef Available------ X1+X2<= 85000
6. Maximum Grain Available---- X3+X4<= 100000
C) Solution of Model through Excel.
Variables
X1Beef in Fore
X2Beef In aft
X3Grain in Fore
X4Grain In aft

Objective
function

X1
0.3
5

Constraint
Fore weigh0t
Capacity
aft weight
capacity
volume capacityFore
Volume capacityaft
Max beef
available

X2
0.3
5

X3
0.1
2

X4
0.1
2

X1
1

X2
0

X3
1

X4
0

0.2

0.4

0.2

0.4

LHS
7000
0
9000
0
1400
0
3300
0
8500
0

Sign
<=

RHS
70,000

<=

90000

<=

30000

<=

40000

<=

85000

Max grain
Available

Optimal value

7000
0
3875
0

15000

75000

Max Value

7500
0

<=

Answer Report Analysis:

1. This is the most self-explanatory report.
2. We can see that the optimal solution to the LP has value 38750 ($).
3. Optimal Values of Each Variable to attain this solution are Quantity of Beef in
Fore( X1)= 70,000 Pound, Quantity of Beef in aft( X2)= 15,000 Pound, Quantity of
Grain in fore(X3)= 0, Quantity of Grain in aft (X4)= 75000 Pound
4. We had six constraints for in our LP. The Fore Weight capacity constraint, The Aft
Weight capacity Constraint and Max Beef available constraint is declared to be
'Binding' whilst the other three constraints are declared to be 'Non-Binding'.
Constraints with a 'Slack' value of zero are said to be tight or binding in that they are
satisfied with equality at the LP optimal. Constraints which are not tight are called
loose or not binding. So Constraint the Aft Weight capacity Constraint and Max Beef
available constraint are loose.
Sensitivity Report Analysis:
This
sensitivity
report
provides
us
with
information
relating
to:
1.
Changing
the
objective
function
coefficient
for
a
variable
2.
Forcing
a
variable
which
is
currently
zero
to
be
non-zero
3. Changing the right-hand side of a constraint.
While analysing Variable cells factors which describe about the optimal solutions available,
Final value column will give the value the optimal solutions available such as are Quantity of
Beef in Fore( X1)= 70,000 Pound, Quantity of Beef in aft( X2)= 15,000 Pound, Quantity of
Grain in fore(X3)= 0, Quantity of Grain in aft (X4)= 75000 Pound.
While analysing constraint table, we have two column. One is final value column which says
about the used amount of constraint factor whereas constraint R.H side which says the total
available amount of constraint factor. Here, Except, Volume capacity of Aft and fore
constraint and Maximum Grain constraint, all are fully utilized. There is one more column
known as shadow price, which says that, used to determine to check the How solution or
Objective functional value change if You obtain additional unit of Constraint. For Example:
For constraint fore weight capacity, if RHS is changed by one unit i.e. from 70,000 to 70001,
then our solution will increase by 0.12 times and this has maximum allowable increase of
15000 and decrease of 70,000.

100000

Question 2: As a result of a recently passed bill, a congressman's district has been

allocated $4 million for programs and projects. It is up to the congressman to decide
how to distribute the money. The congressman has decided to allocate the money to four
ongoing programs because of their importance to his district a job training program, a
parks project, a sanitation project, and a mobile library. However, the congressman
wants to distribute the money in a manner that will please the most voters, or, in other
words, gain him the most votes in the upcoming election. His staff's estimates of the
number of votes gained per dollar spent for the various programs are as follows:
Program Votes/Dollar Job training 0.02Parks 0.09Sanitation 0.06Mobile library 0.04In
order also to satisfy several local influential citizens who financed his election, he is
obligated to observe the following guidelines: None of the programs can receive more
than 40% of the total allocation. The amount allocated to parks cannot exceed the total
allocated to both the sanitation project and the mobile library. The amount allocated to
job training must at least equal the amount spent on the sanitation project. Any money
not spent in the district will be returned to the government; therefore, the congressman
wants to spend it all. The congressman wants to know the amount to allocate to each
program to maximize his votes.
a) Formulate a linear programming model for this problem. b) Solve the model by using
Excel.
Answers:
a) Linear Programming model.
We have four deciding factors for the vote maximization.
So, Variables discovered are
X1
Dollar spent on Job training
X2
Dollar spent on Parks
X3
Dollar spent on Sanitation
X4
Dollar spent on Mobile
library
Linear Programming Model:
Objective Function: 0.02X1+0.09X2+0.06X3+0.04X4
Subject to
Constraint:
Job training less 40%----X1<= 1600000
Parks less than 40%
X2<=1600000
Sanitation less than 40%
X1<= 1600000
Mobile Library less than 40% X1<= 1600000
Parks Vs Sanitation and Mobile lib X3+X4-X2>= 0
Job training and Sanitation
X1-X3>= 0
X1
Dollar
spent on
Job
training

X2
X3
X4

Dollar spent on
Parks
Dollar spent on
Sanitation
Dollar spent on
Mobile library

Objective function

X1
0.02

X2
0.09

X3
0.06

X4
0.04

Constraint
Job training less
40%
Parks less than 40%

X1
1

X2
0

X3
0

X4
0

Sanitation less than

40%
Mobile Library less
than 40%
Parks Vs Sanitation and
Mobile lib
Job training and
Sanitation

-1

-1

Optimum Value

160000
0
336000

160000
0

160000
0

160000
0

Max Value

LHS
160000
0
160000
0
160000
0
160000
0
160000
0
0

Sign RHS
<=
160000
0
<=
160000
0
<=
160000
0
<=
160000
0
>=
0
>=

B) Excel Solution:
Answer Report Analysis:
1. This is the most self-explanatory report.
2. We can see that the optimal solution to the LP has value 336000 votes.
3. Optimal Values of Each Variable to attain this solution are
X1
X2
X3
X4

Dollar spent on Job training

Dollar spent on Parks
Dollar spent on Sanitation
Dollar spent on Mobile library

4. We had six constraints for in our LP. The constraint which says that amount allocated
to park cannot exceed the total allocated to both the sanitation project and the mobile

library is only Non-binding constraint and hence gives slack of 160000 whereas all
other constraint gives slack 0 and hence Binding.
Sensitivity Report Analysis:
This
sensitivity
report
provides
us
with
information
relating
to:
1.
Changing
the
objective
function
coefficient
for
a
variable
2.
Forcing
a
variable
which
is
currently
zero
to
be
non-zero
3. Changing the right-hand side of a constraint.
While analysing Variable cells factors which describe about the optimal solutions available,
final value column will give the value the optimal solutions available such as
X1 = 160000
X2= 160000
X3= 160000
X4= 160000

Dollar spent on Job training

Dollar spent on Parks
Dollar spent on Sanitation
Dollar spent on Mobile library

While analysing constraint table, we have two column. One is final value column which says
about the used amount of constraint factor whereas constraint R.H side which says the total
available amount of constraint factor. There is one more column known as shadow price,
which says that, used to determine to check the How solution or Objective functional value
change if You obtain additional unit of Constraint. For Example: For constraint Job training
less than 40% , if RHS is changed by one unit i.e. from 160000 to 160001 , then our solution
will increase by 0.02 times and this has maximum allowable increase of 10^30 and decrease
of 0.

References
www.mathtools.com/simplexsolver