AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

MBA, Semester 2 Operations Management Ms. Aarti Mehta Sharma

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Linear programming

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

An efficient method for determining an optimal decision from a large no. of decisions. - Selection of product mix - Maximize profits, subject to constraints

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

- Objective fn Z = c1x1 + c2x2 + cnxn - c1,c2 are uncontrollable variables - X1, x2 are different attributes

AM ITY GLOBAL BUSINESS SCHOOL

General model of LPP

Bangalore

Optimize (maximize or minimize) Z = c1x1 + c2x2 + cnxn Subject to linear constraints A11x1 + a12x2 + .. + a1nxn (,=,>=) A21x1 + a22x2 + .. + a2nxn (,=,>=) . Am1x1 + am2x2 + .. + amnxn (,=,>=) X1,x2.xn 0

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Graphical method Simplex method

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Graphical method

Bangalore

A small scale industry manufactures electrical regulators, the assembly of which is being accomplished by a small group of skilled workers, both men and women. Due to the limitations of space and finance, the no. of workers employed cannot exceed 11 and their salary bill not exceed more than Rs 60,000 per month.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

The male members of the skilled workers are paid Rs 6000 p.m. and female workers Rs 5000 p.m. data collected on the performance of these workers indicate that a male member contributes Rs 10,000 pm to total return of the industry and a female worker contributes Rs 8,500 p.m. determine the no. of male and female workers to be employed to maximize the monthly total return.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

X1 = male workers X2 = female workers Maximize Z = 10,000x1 + 8500 x2 X1 + x2 11 6000 x1 + 5000 x2 60,000 6x1 + 5 x2 60 x1 0; x2 0

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Bangalore

Turn inequalities into equalities X1 + x2 11 X1 + x2 = 11 when x1 =0, x2 = 11 when x1 =11, x2 = 0 6x1 + 5 x2 60 6x1 + 5 x2 = 60 when x1 =0, x2 = 12 when x1 =10, x2 = 0

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

11

x2

x1

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

O- 0,0 B 10,0 P 5,6 C 0,11

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Maximize Z = 10,000x1 + 8500 x2 O ; 10,000 * 0 + 8500 * 0 = 0 B ; 10,000 * 10 + 8500 * 0 = 1,00,000 C ; 10,000 * 0 + 8500 * 11 = 93,500 O ; 10,000 * 5 + 8500 * 6 = 1,01,000 X1 = 5 X2 = 6

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

A company manufactures two types of products P1 and P2. each product uses lathe and milling machines. The processing time per unit of P1 on the lathe is 5 hours and on the milling machine is 4 hours. The processing time per unit of P2 on the lathe is 10 hours and on the milling machine is 4 hours. The maximum no. of hours available per week on the lathe and the milling machine are 60 hrs and 40 hrs. The profit per unit of P1 = Rs 6.00 and P2 = Rs 8.00. Formulate a LP model to determine the production volume of
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Each of the products such that the total profit is maximised. Soln : maximize Z = 6x1 + 8 X2 subject to 5 x1 + 10 x2 60 4 x1 + 4 x2 40 x1 0 ; x2 0

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

maximize Z = 6x1 + 8 X2 + 0s1 +0s2 subject to 5 x1 + 10 x2 = 60 4 x1 + 4 x2 = 40 x1 0 ; x2 0;

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

A company manufactures two types of products P1 and P2. each product uses lathe and milling machines. The processing time per unit of P1 on the lathe is 5 hours and on the milling machine is 4 hours. The processing time per unit of P2 on the lathe is 10 hours and on the milling machine is 4 hours. The maximum no. of hours available per week on the lathe and the milling machine are 60 hrs and 40 hrs. The profit per unit of P1 = Rs 6.00 and P2 = Rs 8.00. Formulate a LP model to determine the production volume of
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Each of the products such that the total profit is maximised. Soln : maximize Z = 6x1 + 8 X2 subject to 5 x1 + 10 x2 60 4 x1 + 4 x2 40 x1 0 ; x2 0

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

maximize Z = 6x1 + 8 X2 + 0s1 +0s2 subject to 5 x1 + 10 x2 + s1 = 60 4 x1 + 4 x2 + s2 = 40 x1 0 ; x2 0; s1,s2 0 S1, s2 are called slack variables

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

CBi Cj Basic variables 0 0 S1 s2 Zj Cj - Zj

6 x1 5 4 0 6

8 x2

0 s1

0 s2 0 1 0 0

soluti ratio on
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10 1 4 0 0 8 0 0

60 40 0

60/10 = 6 40/4 =10

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Bangalore

Continue till last row entries are all zero or negative Choose largest value in last row = 8 Column with largest value is known as pivotal column Divide values of soln column with values of pivotal colum Choose min pivotal row 10 becomes pivot no. Reduce 10 to 1; reduce other values in col to 0
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

CBi Cj Basic variables 8 0 x2 s2 Zj Cj - Zj

6 x1

0 s2

x2 s1

solutiratio on
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1/2 1 2 0 4 2 8 0

1/10 0 -2/5 1 4/5 0 -4/5 0

6 16 48

6/1/2 = 12 16/2 = 8

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Bangalore

CBi Cj

8 x2 1 0 8 0

0 s1

0 s2

solution
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Basic x1 variables 8 6 x2 x1 Zj Cj - Zj 0 1 6 0

1/5 -1/4 -1/5 1/2 2/5 1 -2/5 -1

2 8 64

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Stop when all values in last row are 0 or negative The corresponding optimal solution is : X1(production volume of P1) = 8 units X2(production volume of P2) = 2 units

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AM ITY GLOBAL BUSINESS SCHOOL

Case

Bangalore

Maximize Z= 10x1 + 15 x2 + 20 x 3 Subject to 2x1 + 4x2 + 6x 3<= 24 3x1 + 9x2 + 6x3<= 30 x1,x2, x3 >=0

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Solution

Bangalore

Maximize Z= 10x1 + 15 x2 + 20 x3 +0s1 + 0s2 Subject to 2x1 + 4x2 + 6x 3 + s1 = 24 3x1 + 9x2 + 6x3 + s2 = 30 x1,x2, x3 s1, s2,s3 >=0 Where s1 & s2 are slack variables

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

CBi Cj Basic variables 0 0 S1 s2 Zj Cj - Zj

10 15 20 0 x1 2 3 x2 4 9 x3 6 6 s1 1 0

0 s2 0 1 0 0

soluti ratio on

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24 30 0

24/6 = 4 5

0 0 0 0 10 15 20 0

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CBi Cj

10 x1

15 x2 2/3 5

20 x3 1 0

0 s1 1/6 -1 10/3

0 s2

soln ratio

Bangalore

Basic var 20 X3 0 s2 Zj

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1/3 1

0 1 0

4 6

12 6

20/3 40/3 20 0

80 (20*4)

Cj - Zj 10/3 5/3

-10/3 0

CBi Cj 10 15 Basic x1 x2 variables 20 10 X3 X1 Zj Cj - Zj 0 1 -1 5

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20 0 x3 s1 1 0 1/2 -1

0 s2 -1/3 1 10/3 -10/3

Solution

Bangalore

30

2 6 100

10 30 0

20 0 0

-15 0

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Since all the values of Cj-Zj are less than or equal to zero, the optimality is there and X1 = 6, X2 = 0; X3 = 2 and Zoptimum = 100
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AM ITY GLOBAL BUSINESS SCHOOL

Case

Bangalore

A company makes two kinds of leather bags bag A and bag B. Bag A is a high quality bag and bag B is of lower quality. The respective profits are Rs. 4 and Rs. 3 per bag. The production of each of type A requires twice as much time as a bag of type B. if all bags were of type B, the company could make 1000 bags per day.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

The supply of leather is sufficient for only 800 bags per day (Both A & B combined). Bag A requires a fancy buckle and only 400 of these are available . There are only 700 buckles a day available for belt B. What should be the daily production of each type of belt ? Formulate this problem as an LP problem and solve it using the simplex method.
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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Maximize Z = 4x1 +3x2 Subject to the constraints 2x1 + x2 <=1000 X1 +x2 <= 800 X1<=400 X2<= 700 and x1,x2 >=0

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AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Maximize Z = 4x1 +3x2 +0s1 + 0s2 +0s3 + 0s4

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Subject to the constraints 2x1 + x2 + s1 =1000 X1 +x2 + s2= 800 X1+ s3 =400 X2 + s4 = 700 and x1,x2,s1,s2,s3,s4 >=0

Cj ITY GLOBAL AM

3
x2

0
s1

0
s4
Bangalore Min ratio

BUSINESS Soln Profit Basic SCHOOLx1 per variabl variable unit Cb es s

s2 s3

0 0 0 0

S1 S2 S3 S4

1000 2 800 400 700 zj 1 1 0 0 4

1 1 0 1 0 3

1 0 0 0 0 0

0 1 0 0 0 0

0 0 1 0 0 0

0 0 0 1 0 0

500 800 400

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Not defined

Cj - Zj

Cj

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Basic variables

4 3 0 0 0

Bangalore

Profit per unit Cb

Soln x1 x2 s1 s2 s3 s4 Min ratio variables

0 0 4 0

S1 S2 x1 S4 zj

200 400 400 700

0 0 1 0 4

1 1 0 1 0

1 0 0 0 0

0 1 0 0 0

-2 -1 1 0 4

0 0 0 1 0

200/1 400/1 700/1

37

Cj - Zj

0 3 0 0 -4 0

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Bangalore

R2(new) R2(old)-R1(new) R4(new)R4(old)-R1(new)

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AM Cj ITY GLOBAL

Profit perBasic Soln x1 x2 unit Cb variabl variabl es es

BUSINESS SCHOOL

0
s1

0 0
s2 s3

0
s4 Min ratio
Bangalore

3 0 4 0

X2 S2 X1 S4

200 200 400 500 zj

0 0 1 0 4 0

1 0 0 0 3 0

1 -1 0 -1 3 -3

0 1 0 0 0

-2 1 1 2 -2

0 0 0 1 0 0

39

200/1 400/1 500/2

Cj - Zj

0 2

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Bangalore

R1(new) R1(old) + 2R2(new) R3(new) R3(old) R2(new) R4(new) R4(old) 2R2

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AM Cj ITY GLOBAL
Profit per Basic unit Cb variables

BUSINESS SCHOOL

4 3

0
s1

0
s2

0
s3

0
Bangalore

Soln x1 x2 variables

s4

3 0 4 0

x2 S3 x1 S4 zj

600 200 200 100

0 0 1 0 4

1 0 0 0 3

-1 -1 1 1 1 -1

2 1 -1 -2 2

0 1 0 0 0

0 0 0 1 0 0

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Cj - Zj

0 0

-2 0

AM ITY GLOBAL BUSINESS SCHOOL

Bangalore

Since Cj Zj <= 0, the current solution cannot be improved upon. Thus , the company must manufacture x1 = 200 bags of type A and x2 = 600 bags of type B to obtain the max profit of Rs. 2,600.
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