National Institute of Agricultural Marketing

Operation Research Assignment

Submitted by Priyanka Rawat Roll No.236 PGDABM (2010-12) NIAM

QUESTION 1 : On a chicken farm, the poultry is given a healthy diet to gain weight. The chickens have to consume a minimum of 15 units of Substance A and another 15 units of Substance B. In the market there are only two classes of compounds: Type X, with a composition of one unit of A to five units of B, and another type, Y, with a composition of five units of A to one of B. The price of Type X is $10 and Type Y, $30. What are the quantities of each type of compound that have to be purchased to cover the needs of the diet with a minimal cost?
SOLUTION:1)

Choose the unknowns.

x = X y = Y

2) Write the objective function. F(x, y) = 10x + 30y 3) Write the constraints as a system of inequalities .

X A B

Minimal

1 5

5 1

15 15

x + 5y 15 5x + y 15 x 0 y 0

4) Find the set of feasible solutions that graphically represent the constraints.

Calculate the coordinates of the vertices from the compound of feasible solutions .

5) Calculate the value of the objective function at each of the vertices to determine which of them

has the maximum or minimum values. It must be taken into acc ount the possible non -existence of a solution if the compound is not bounded.
F (0, 15) = 10 0 + 30 15 = 450 F (15, 0) = 10 15 + 30 0 = 150 F (5/2, 5/2) = 10 5/2 + 30 5/2 = 100 Minimum

Hence, minimum cost is $100 for X = 5/2 and Y = 5/2.

QUESTIONS2: The Dewright Company is considering three new products to replace current models that are being discontinued, so their OR department has been assigned the task of determining which mix of these products should be produced. Management wants primary consideration given to three factors: long-run profit, stability in the workforce, and the level of capital investment that would be required now for new equipment. In particular, management has established the goals of (1) achieving a long-run profit of at least $125 million from these products, (2) maintaining the current employment level of 4000 employees, and (3) holding the capital investment to less than $55 million. However, management realizes that it probably will not be possible to attain all these goals simultaneously, so it has discussed priorities with the OR department. This discussion has led to setting penalty weights of 5 for missing the profit goal (per $1 million under), 2 for going over the employment goal (per 100 employees), 4 for going under this same goal, and 3 for exceeding the capital investment goal (per $1 million over). Each new products contribution to profit, employment level, and capital investment level is proportional to the rate of production. These contributions per unit rate of production are shown in the following table, along with the goals and penalty weights.
Unit Contribution

Product Factor 1 2 3 Goal (Units) 125 (millions of dollars) = 40 (hundreds of employees) 55 (millions of dollars) Penalty Weight 5

Long-run profit

12

15

Employment level

2(+), 4()

Capital investment

SOLUTION: Decision variables x1: production rate of product 1 x2: production rate of product 2 x3: production rate of product 3 Three goals Profit goal: 12 x1 + 9 x2 + 15 x3 125 (lower one-sided goal) Employment goal: 5 x1 + 3 x2 + 4 x3 = 40 (two-sided goal) Investment goal: 5 x1 + 7 x2 + 8 x3 55 (upper one-sided goal) Objective function: Min Z = 5(12 x1 + 9 x2 + 15 x3 125)+ 2(5 x1 + 3 x2 + 4 x3 40)+ + 4(5 x1 + 3 x2 + 4 x3 40)+ 3(5 x1 + 7 x2 + 8 x3 55)+ Where X if x 0 X+ = 0 if x < 0 To put into a proper LP form Let y1 = 12 x1 + 9 x2 + 15 x3 125 y2 = 5 x1 + 3 x2 + 4 x3 40 y3 = 5 x1 + 7 x2 + 8 x3 55 And y1 = y1+ - y1- and y1+ 0, y1- 0 y2 = y2+ - y2- and y2+ 0, y2- 0 y3 = y3+ - y3- and y3+ 0, y3- 0 Final LP for no preemptive goal programming: x- = - x = |x| if x 0 0 if x > 0

Min Z = Subject to

5 y1- + 2 y2+ + 4 y2- + 3 y3+

12 x1 + 9 x2 + 15 x3 (y1+ - y1-) = 125 5 x1 + 3 x2 + 4 x3 (y2+ - y2-) = 40 5 x1 + 7 x2 + 8 x3 (y3+ - y3-) = 55 Xi, yi+, yi- 0 i=1, 2, 3

Add any other functional constraints too Optimal solution: x1 = 25/3 x2 = 0 x3 = 5/3 y1+ = y1- = 0 y1 = 0 1st goal is satisfied

y2+ = 25/3, y2- = 0 y2 = 25/3 2nd goal exceeds employment level by employees y3+ = y3- = 0 y3 = 0 3rd goal is satisfied

25/3 hundred