Chapter 8 Linear Programming

Answer 1
(a)
M F
Contribution per unit $96 $110
Litres of material P required 8 10
Contribution per litre of material P $12 $11
an!in" 1 2
Produ#tion$sales (units) 1%000 2%&2'
[1.5] [1.5]
&1%2'0 litres of P less (1%000 ( 8) for M ) 2&%2'0 litres for F "i*in" a total produ#tion
of 2%&2' units (2&%2'0$10)+
(b)
M F ,otal Marks
($000) ($000) ($000)
-ales 200 .88+2'0 688+2'0 [1]
/ariable #osts0
Material P 20 '8+12' 18+12'
Material 2 .0 .6+'00 86+'00
3ire#t labour 28 81+&1' 109+&1'
4*er5ead 16 .6+'00 62+'00
10. 2&2+'00 &&6+'00 [2]
Contribution 96 2''+1'0 &'1+1'0
Fi(ed #osts $(1'0%000 6 '1%1'0) 201+1'0 [1]
Profit 1..+000 [4]
(#)
Let M ) number of units of M produ#ed for period 1
F ) number of units of F produ#ed for period 1
7 ) total #ontribution
Ma(imi8e 7 ) 96M 6 110F (produ#t #ontributions) sub9e#t to0 [0.5]
8M 6 10F &1%2'0 (material P #onstraint) [0.5]
10M 6 'F 20%000 (material 2 #onstraint) [0.5]
.M 6 'F 11%'00 (dire#t labour #onstraint) [0.5]
:8;1
M 1%000 (ma(imum demand for M) [0.5]
F &%000 (ma(imum demand for F) [0.5]
,5e abo*e #onstraints are plotted on t5e "rap5 s5o<n in t5e follo<in" fi"ure0
[3 marks]
Material P= Line from M ) &%906+2'% F ) 0 to F ) &%12'% M ) 0
Material 2= Line from M ) 2%000% F ) 0 to F ) .%000% M ) 0
3ire#t labour= Line from M ) .%&1'% F ) 0 to F ) &%'00% M ) 0
-ales demand of M= Line from M ) 1%000
-ales demand of F= Line from F ) &%000
,5e optimal solution o##urs <5ere t5e lines in t5e abo*e Fi"ure interse#t for material
P and 2 #onstraints+ ,5e point #an be determined from t5e "rap5 or mat5emati#all> as
follo<s0
:8;2
8M 6 10F ) &1%2'0 (material P #onstraint)
10M 6 'F ) 20%000 (material 2 #onstraint)
multipl>in" t5e first equation b> 1 and t5e se#ond equation b> 20
8M 6 10F ) &1%2'0
20M 6 10F ) .0%000
subtra#tin" ?12M ) ? 8%1'0
M ) 129+166
-ubstitutin" for M in t5e first equation0
8(129+166) 6 10F ) &1%2'0
F ) 2%'.1+661
[1 mark for the answers of M an !]
(d)
$
Contribution0 (129 units of M at $96) 69%98.
(2%'.2 units of F at $110) 219%620
&.9%60.
Less0 fi(ed #osts 201%1'0
Profit 1.1%8'.
[2 marks]
(e)
Mo*in" from t5e solution in (#) <5ere t5e lines interse#t as a result of obtainin" an
additional litre of material 2 "i*es t5e follo<in" re*ised equations0
8M 6 10F ) &1 2'0 (material P #onstraint)
10M 6 'F ) 20 001 (material 2 #onstraint) [1 mark]
,5e *alues of M and F <5en t5e abo*e equations are sol*ed are 129+&&& and
2%'.1+'&&+ ,5erefore% M is in#reased b> 0+161 units and F is redu#ed b> 0+1&. units
"i*in" an additional total #ontribution of $1+292 @0+161 A $96) ? (0+1&. A $110)B per
additional litre of 2+ ,5erefore t5e s5ado< pri#e of 2 is $1+292 per litre+ [3 marks]
:8;&
Answer 2
(a)
Let C ) number of units of CL produ#ed ea#5 <ee!
D ) number of units of DM produ#ed ea#5 <ee!
7 ) total #ontribution
,5e linear pro"rammin" model is0
Ma(imi8e 7 ) .0C 6 &0D (produ#t #ontributions) sub9e#t to
.C 6 .D 120 (materials #onstraint)
.C 6 2D 100 (labour #onstraint)
C 6 2D '0 (platin" #onstraint)
C% D 0
,5e abo*e #onstraints are plotted on t5e follo<in" Fi"ure+ ,5e optimum output is at
point C on t5e "rap5% indi#atin" t5at 20 units of CL and 10 units of DM s5ould be
produ#ed+ ,5e optimum output #an be determined e(a#tl> b> sol*in" t5e simultaneous
equations for t5e #onstraints t5at interse#t at point C0
:8;.
.C 6 .D ) 120
.C 6 2D ) 100
-ubtra#tin" 2D ) 20
D ) 10
C ) 20
,5e ma(imum <ee!l> profit is0
(20 ( $.0) 6 (10 ( $&0) ? $100 fi(ed #osts ) $.00
(b)
,5e present ob9e#ti*e fun#tion is .0C 6 &0D and t5e "radient of t5is line is ?.0$&0+ Ef
t5e sellin" pri#e of DM <ere in#reased% t5e #ontribution of DM <ould in#rease and
t5e "radient of t5e line (?.0$&0) <ould de#rease+ ,5e #urrent optimal point is C
be#ause t5e "radient of t5e ob9e#ti*e fun#tion line is "reater t5an t5e "radient of t5e
line for t5e #onstraint of materials (t5e line on <5i#5 t5e optimal point C falls)+ Ef t5e
"radient of t5e ob9e#ti*e fun#tion line <ere equal to t5e "radient of t5e line for t5e
materials #onstraint% t5e optimal solution <ould be an> point on FC+ ,5e "radient for
t5e materials #onstraint line is ?1+ Ef t5e "radient for t5e ob9e#ti*e fun#tion line <ere
less t5an ?1% t5e optimal solution <ould #5an"e from point C to point F+ ,5e "radient
of t5e line for t5e #urrent ob9e#ti*e fun#tion of .0C 6 &0D <ill be "reater t5an ?1 as
lon" as t5e #ontribution from DM is less t5an $.0+ Ef t5e #ontribution from DM is $.0
or more% t5e optimum solution <ill #5an"e+ ,5erefore t5e ma(imum sellin" pri#e for
DM is $190 ($1'0 *ariable #ost 6 $.0 #ontribution)+
(#)
Ef platin" time #an be sold for $16 per 5our t5en an> 5our de*oted to CLs and DMs
loses $16 sales re*enue+ ,5e rele*ant #ost per platin" 5our is no< $16 opportunit>
#ost+ ,5e #ontributions used in t5e ob9e#ti*e fun#tion s5ould be #5an"ed to refle#t t5is
opportunit> #ost+ ,5e #ontribution s5ould be redu#ed b> $. (1 5our at $16 ? $12) for
CL and b> $8 (2 5ours at $16 ? $12) for DL+ ,5e re*ised ob9e#ti*e fun#tion is0
7 ) &6C 6 22D
(d)
,5e s#ar#e resour#es are materials and labour+ ,5is is be#ause t5ese t<o #onstraints
interse#t at t5e optimal point C+ Platin" is not a s#ar#e resour#e% and t5e s5ado< pri#e
is 8ero+
:8;'
Ef <e obtain an additional unit of materials t5e re*ised #onstraints <ill be0
.C 6 .D ) 121 (materials)
.C 6 2D ) 100 (labour)
,5e *alues of C and D <5en t5e abo*e equations are sol*ed at 10+' for D and 19+1'
for C+ ,5erefore DM is in#reased b> 0+' units and CL is redu#ed b> 0+2' units and t5e
#5an"e in #ontribution <ill be as follo<s0
$
En#rease in #ontribution of DM (0+' ( $&0) 1'
3e#rease in #ontribution of CL (0+2' ( $.0) 10
En#rease in #ontribution (s5ado< pri#e) '
Ef <e obtain one additional labour 5our% t5e re*ised #onstraints <ill be0
.C 6 .D ) 120(materials)
.C 6 2D ) 101 (labour)
,5e *alues of C and D <5en t5e abo*e equations are sol*ed are 9+' for D and 20+' for
C+ ,5erefore CL is in#reased b> 0+' units and DM is redu#ed b> 0+' units% and t5e
#5an"e in #ontribution <ill be as follo<s0
$
En#rease in #ontribution of CL (0+' ( $.0) 20
3e#rease in #ontribution of DM (0+' ( $&0) 1'
En#rease in #ontribution (s5ado< pri#e) '
,5e rele*ant #ost of resour#es used in produ#in" 7G #onsists of t5e a#quisition #ost
plus t5e s5ado< pri#e (opportunit> #ost)+ ,5e rele*ant #ost #al#ulation is0
$
Material : @' !" at ($10 6 $')B 1'
Labour @' 5ours at ($8 6 $') 6'
Platin" (1 5our at $12) 12
4t5er *ariable #osts 90
2.2
:8;6
,5e sellin" pri#e is less t5an t5e rele*ant #ost+ ,5erefore produ#t 7G is not a
profitable addition to t5e produ#t ran"e+
(e)
,5e s5ado< pri#e of labour is $' per 5our+ ,5erefore t5e #ompan> s5ould be prepared
to pa> up to $' in e(#ess of t5e #urrent rate of $8 in order to remo*e t5e #onstraint+ :n
o*ertime pa>ment in*ol*es an e(tra $. per 5our% and t5erefore o*ertime <or!in" is
<ort5<5ile+
En#reasin" dire#t labour 5ours <ill result in t5e labour #onstraint s5iftin" to t5e ri"5t+
Ho<e*er% <5en t5e labour #onstraint line rea#5es point I% furt5er in#reases in labour
<ill not enable output to be e(panded (t5is is be#ause ot5er #onstraints <ill be
bindin")+ ,5e ne< optimal produ#t mi( <ill be at point I% <it5 an output of &0 units
of CL and 8ero of DM+ ,5is produ#t mi( requires 120 5ours (&0 ( . 5rs)+ ,5erefore
120 labour 5ours <ill be <or!ed ea#5 <ee!+ Gote t5at profit <ill in#rease b> $20 @20
( ($' ? $.)B+
Answer 3
(a)
"efine #aria$%es
Let ( ) t5e number of C produ#ed
Let > ) t5e number of D produ#ed
&sta$%ish o$'e(ti#e f)n(tion
,5e ob9e#ti*e is to minimi8e total produ#tion #ost (C)+ ,5e produ#tion #ost of C )
$100 and t5e produ#tion #ost of D ) $80 ("i*en in t5e question)+ ,5e ob9e#ti*e is to0
Minimi8e C ) 100( 6 80>
&sta$%ish (onstraints
(i) ( 6 > J 100 (minimum produ#tion requirement)
(ii) > K 2( (produ#tion ratio #onstraint)
(iii) ( K 2> (produ#tion ratio #onstraint)
(i*) &( 6 2> K .20 (platin" resour#es #onstraint)
(*) .( 6 8> K 800 (#ir#uitr> resour#es #onstraint)
(*i) ($& 6 2>$1' K &. (or 20( 6 8> K &. A 60) (assembl> resour#es #onstraint)
:8;1
*raph the pro$%em
For ea#5 of t5e #onstraint equations% turn t5e inequalit> si"n into an equals si"n% set (
and t5en > equal to 0 and sol*e t5e resultin" equations to find t5e points at <5i#5 t5e
#onstraints #ross t5e a(es+
Iquation (i)
( 0 100
> 100 0
Iquation (ii)
( 0 '0
> 0 100
Iquation (iii)
( 0 200
> 0 100
Iquation (i*)
( 0 1.0
> 210 0
Iquation (*)
( 0 200
> 100 0
Iquation (*i)
( 0 102
> 2'' 0
:8;8
"efine feasi$%e area
Label t5e feasible area on t5e "rap5+ Et "i*es a feasible area of :FC3I+
"etermine optiona% so%)tion
C ) 100( 6 80>
8%000 ) 100( 6 80> (sa>)
( 0 80
> 100 0
,5e ob9e#ti*e is to minimi8e #osts+ Ef <e put a ruler on t5e ob9e#ti*e fun#tion on t5e
"rap5 and slide it a#ross t5e pa"e% t5e first point of t5e feasible area it en#ounters (i+e+
as #lose to t5e ori"in as possible) is t5e optimal solution+ ,5is #an be seen to be point
F% t5e interse#tion of #onstraints (i) and (ii)+
:t F0
( 6 > ) 100 (1)
> ) 2( (2)
-ub (2) into (1)%
( 62( ) 100%
&( ) 100
( ) && 1$&
:8;9
> ) 66 2$&
Answer 4
(a)
(b)
:8;10
:8;11
(#)
(d)
:8;12
:8;1&