LP Practice Question

The Puck and Pawn Company manufactures hockey sticks and chess sets. Each hockey stick yields an
incremental profit of $2, and each chess set, $4. A hockey stick requires four hours of processing at Machine
Center X, and two hours at Machine Center Y. A chess set requires six hours at Machine Center X, six hours
at Machine Center Y, and one hour at Machine Center Z. Machine Center X has a maximum of 120 hours of
available capacity per day, Machine Center Y has 72 hours and Machine Center Z has 10 hours. The company
would like to determine how many hockey sticks and how many chess sets to produce in order to maximize
their overall profit.

A linear programming formulation for this problem is shown below, along with a graph of the constraints.

Maximize Z = 2H + 4C

Subject to:
Machine Center X 4H + 6C <= 120 (series 1 on graph)
Machine Center Y 2H + 6C <= 72 (series 2 on graph)
Machine Center Z C <= 10 (series 3 on graph)
H, C >= 0

25

Series1
20
Series2
Series3
15
C

10

0
0 10 20 30 40
H

a) How many of each product should the Puck and Pawn Company produce to maximize profit and how
much profit can they make?

b) At the optimal solution point, how many hours are left over at Machine Centers X, Y, and Z?
 c) Are any of the constraints considered redundant? Why or why not?

d) Are any of the constraints considered binding constraints? Why or why not?

Using the following Solver table, answer the questions below.

Adjustable Cells
Final Reduced Objective Allowable Allowable
Cell Name Value Cost Coefficient Increase Decrease
$B$12 Hockey Sticks H 0 2 0.666666667 0.666666667
$B$13 Chess Sets H 0 4 2 1

Constraints
Final Shadow Constraint Allowable Allowable
Cell Name Value Price R.H. Side Increase Decrease
$E$7 X Usage 0.333333333 120 24 36
$E$8 Y Usage 0.333333333 72 18 12
$E$9 Z Usage 0 10 1E+30 6

e) What is the limit to which you could increase the Right-hand-side value of Machine Center X to
increase profits? What is the new profit achieved?

f) If you could acquire additional resources for Machine Center Z at a price of $.50, would you? Why or
why not?

g) If the objective function coefficient for chess sets increased to $5, would the optimal combination
your determined change? Determine the new profit level for given this new objective coefficient (if
it is possible to calculate it).

h) If the firm introduced a new constraint that required the company to produce no more than 35
hockey sticks, would the feasible solution space be impacted? Why or why not?
LP Practice Question Solutions

a) 24 hockey sticks, 4 chess sets for a maximized revenue =

z = 2(24) + 4(4) = 48 + 16 = $64

b) Hours left at Machine Center X = 0

Hours left at Machine Center Y = 0
Hours left at Machine Center Z = 6

c) No, they all impact the feasible solution space.

d) Although all of the constraints form the feasible solution space, the X and Y constraints are
truly binding because their intersection creates the optimal solution point.

e) Allowable increase = 24. Thus, 120 + 24 = 144

24 x shadow price of $.33 = $7.92
Add this to original of $64 and get new revenue amount of $71.92

f) No, you already have slack of Machine Center Z (shadow price = $0)

g) No, optimal combination remains the same because it is in the allowable range (maximum upper
end limit is $6). New profit = 2H + 5C = 2(24) + 5(4) = 48 + 20 = $68

h) No, its a redundant constraint. Feasible solution space is already to the left of the new
constraint.