The Simplex Method for Solving LPP

Simplex method is an algebraic method for

solving linear programming problem. Under
graphic method ,we can determined optimal
solution for problems with two variables with
two decision variables. The multi-variable
problems can be analyzed though Simplex
variable.
The Simplex method Was formulated by
George B. Dantzig in 1947.
Some Basic Terms Involved in Simplex
Method
❑ Slack Variable
❑ Surplus Variable
❑ Artificial Variable
❑ Initial Basic Feasible Solution
❑ Basic Variable
❑ Non-Basic Variable
 Procedure to Solve the Maximization
Problem by Simplex Method
❑ Formulate a Standard Mathematical Form
❑ Conversion of Inequalities into Equalities
❑ Preparation of Initial Basic Feasible Solution
Table
❑ Test the Solution for Optimality
❑ Formulation of Second Revised Tableau
❑ Preparation of Subsequent Tables for Better
Solution till Optimal Solution is not found.
 Q.1 Simplex Method (Two Variable)
Two products X and Y are processed on two
machines M1and M2. the processing time per
unit, machine availability and profit per unit are
as given-
Machine Processing Time Availability
X Y
M1 4 5 100
M2 5 2 80
Profit per Unit 10 5
Formulate and Solve by Simplex Method.
 Self Practice
A firm makes two types of furniture Chairs and
Tables. The profit is Rs.40 and Rs.60 per unit
respectively. Both product and total time available
per week on each machine are as follows:
Machine Chair Table Available Hours
M1 3 3 36
M2 5 2 60
M3 2 6 60
Using Simplex technique, formulate a profit plan.
 Q.2 Artificial Variable
Maximize Z= 10X1+12X2
Subject to X1+X2=5
X≥2
X2≤4
Where X1 and X2 ≥ 0
Solve it by Simplex method.
Artificial Variable : The Big M Method
As we are already known in (≥)or(=)type
constraint e we added an artificial variable.
These variable are fictitious and have no
physical value.
Simplex Method: Minimization Problem
1. First of all formulate the problem
mathematically.
2. All the inequalities are changed into
equalities according to specified rule.
3. In case of artificial variable the coefficient in
objective function is +M.
4. The decision about optimal solution is taken
if all the values in(cj-zj) row are either positive
or zero.
5. Entering variable is decided by the value
which has maximum negative value in(cj-zj)
row. Further, departing variable is decided by
the minimum positive values in ratio column.
 Minimization : Practical Problem
A firm plans to purchase at least 200 quintals of scrap
containing high quality metal X and low quality metal
Y. It decides that scrap to be purchased must contain
at least 100 quintals of X and not more than 35
quintals of Y metal. The firm can purchase the scrap
from two suppliers (A and B) in unlimited quantities.
The percentage of X and Y metal in terms of weight
of the scraps supplied by A and B is given:
Metal Supplier A Supplier B
X 25% 75%
Y 10% 20%
The price of A’s scrap is Rs.200 and B’s 400 per
quintal. Determine the quantities should be buy.
 Special Problems related to Simplex
Method
1. Unbounded Solution : if in a simplex
procedure it is impossible to find any departing
variable, the solution is called unbounded. It is
possible only when all the elements in the key
column are either zero or negative.
For Example : Maximize Z= 6 X1+ 10 X2
Subject to X1-2X2≤12
X1≤20
X2≥2
Where X1 and X2 ≥0
2. An Infeasible Solution : If in the simplex
table basis column contains any artificial
variable (A) with positive values. Then no
feasible solution exists.
For Example : Maximize Z= 12X1+8X2
Subject to X1 + X2 ≤15
X2≥18
Where X1 and X2 ≥0
 Degeneracy
While solving a L.P. problem the situation may
arise in which there is a tie between two or more
basic variable for leaving i.e., the minimum ratio
to identify the basic variable to leave. This cause
the problem of degeneracy. In other words,
under simplex method , degeneracy occurs,
where there is tie for the minimum positive ratio
for selecting outgoing variable. In this case the
choice for selecting outgoing variable may be
made arbitrarily.
Practical Problem of Degeneracy
Maximize Z= 80x+100y
Subject to, 20x+30y≤3
60x+40y ≤4
Where x and y≥0
 Assignment of Simplex Method
1. Solve the following problem using simplex
method- Maximize Z= 2X1+15X2
Subject to -X1-2X2≥-6
4X1+3X2≤12
Where X1,X2 ≥0
2. Using Simplex technique , solve the following-
Maximize Z = 5X1+2X2+10X3
X1-X3≤10
X2-X3 ≥10
X1+X2+X3≤10
Where, X1,X2,X3 ≥0
 Transportation Problem
We have discussed in the previous chapter the
solution of general linear programming problem.
Now we shall consider a special branch of linear
programming that comprises problems of
transportation.
“The transportation problem is to
transport the various amount of a product
that are initially stored at various origins to
different destinations in such a way that the
total transportation cost is minimum and/or
the time taken in transshipment is minimum.”
In the most general form, a transportation
problem has a number of origins and a number of
destinations. The place where the goods originate
from called a sources or origins and places where
there are to be supplied are called destinations.
To dispatch these goods bears a cost called
transportation cost. The objective of this special
type of linear programming is to minimize the
cost of transportation.
Graphical Representation
It is also Transportation Problem………??
 Origin of Transportation Model
The origin of transportation was first presented by F.L. Hitchcock in
1941. He presented a study entitled “The Distribution of a Product
from Several sources to numerous Localities”. This presentation is
considered to be the first important contribution to the solution of
transportation problems. In 1947 T.C. Koopmans presented in
independent study, not related to Hitchcock’s, and called “Optimum
Utilization of the Transportation System”. These two contributions
helped in the development of transportation methods which involve a
number of shipping sources and a number of destinations. The
transportation problem, received this name because many of its
applications involve determining how to optimally transport goods.
Application of Transportation Problems
❑ Minimize Shipping and Distribution Cost
❑ Determine Low Cost Location
❑ Find Minimum Cost Schedule
❑ Military Distribution System
 Some Important Terminology
1. Feasible Solution : Feasible Solution is that
solution which satisfies the requirement of
RIM(Row and Column or Demand and Supply).

2. Basic Feasible Solution: A feasible solution

is said to be basic if the number of Non-
Negative or Allocations is equal to c+r-1. Here c
is the number of column and r is the number of
rows in a transportation matrix.
3. Optimal Solution : A feasible solution is said
to be optima if it minimize / maximize the
objective of transportation (Cost and Profit).
4. Degenerate Solution: When the number of
positive allocation is less then the required
number (c+r-1), the solution is said to be
degenerate solution, and if it is exactly c+r-1 , it
is said to be non-degenerate solution.
5. Balanced Transportation problem : When
the total availability at the origin is equal to the
total requirement at the destinations is called
balanced transportation problem.
6. Unbalanced Transportation problem:
When the total availability at the origins is not
equal to the total requirements at destinations, is
called Unbalanced transportation problem. For
example in case of total production of factories
is 1300 units and the total demand is 1500 units.
In such types of problem we first convert them
in balanced problem by adding one more
imaginary factory (dummy) with zero
transportation cost.
Solution of a Transportation Problem
❑ Initial Basic Feasible Solution
❑ Optimal Solution
 Methods of Initial Basic Feasible
Solution
for finding Initial Basic Feasible Solution there
are mainly three methods are available-
❑ North –West Corner Method (NWCM)
❑ Lowest Cost Entry Method (LCM)
❑ Vogel’s Approximation Method (VAM)
North -West Corner Method (NWCM)
According to this rule, the first allocation is
made to the cell occupying the upper left hand
(North-West) corner of the matrix. Adjust the
supply and demand requirement. If the supply
for the first row is fulfill then move down to the
first cell in the second row. If the demand for
the first column is satisfied, then move to the
next cell in the second column.
Repeat the procedure until all the rims (rows
and columns) requirements are satisfied.
Lowest Cost Entry Method (LCM)
The least cost methods starts by making the
first allocation to that cell whose shipping cost
per unit is lowest. This lowest cost cell is filled
as much as possible in view of demand and
supply. Thereafter we move to the next lowest
cost cell and make an allocation in view of the
remaining capacity and the requirement of its
row and column.
 NCWM/LCM
Determine an initial basic feasible solution by
North-west corner or Least cost entry method
and Obtain Total Transportation cost -
Availabe at
Factory Market Factory
A B C D
X 18 11 15 20 8
Y 17 14 12 13 24
Z 18 18 15 12 28
Requirem
ent of
Market 12 12 16 20
Vogel’s Approximation Method (VAM)
This method is preferred over the other two
methods because the initial basic feasible
solution is either optimal or very close to the
optimal solution. In this method each allocation
is made on the basis of the opportunity/ penalty
cost that would have incurred if allocation in
certain cells with minimum unit transportation
cost. Various steps of this method are as
follows-
1. Compute a penalty for each row and column in
the transportation table. It is the mere difference
between the smallest and next smallest
transportation cost in that particular row and
column.
2. Identify the row or column with largest
penalty. In this identified row/column ,choose the
cell which has the smallest cost and allocate the
maximum possible quantity to this cell.
3. Repeat step 1 and 2 for the reduced
transportation table until entire rim are satisfied.
 VAM
Determine an initial basic feasible solution to
the following –

Origin Destination Supply

W1 W2 W3 w4 T
F1 19 30 50 10 7 7
F2 70 30 40 60 1 9
1
F3 40 8 70 20 2 18
Demand 5 8 7 14 6
 Unbalanced Transportation Problem:
NWCM/LCEM
Solve the following transportation problem –
Destination
Origin A B C Available
X 30 20 10 800
Y 5 15 25 500
Demand 300 300 400
Unbalanced Transportation Problem: VAM
A company has two factories A and B located
some distance apart three regional warehouse R,S
and T. The transportation manager must schedule
shipment for the coming week according to the
following-
warehouse S requires 60 tons
warehouse R requires 70 tons
warehouse T requires 50 tons
Factory A has 100 tons available
Factory B has 200 tons available
Continued……….
Continued……..
Transportation cost are as follows-
From factory A to warehouse R Rs.30 per ton
From factory A to warehouse S Rs.10 per ton
From factory A to warehouse T Rs.50 per ton
From factory B to warehouse R Rs.20 per ton
From factory B to warehouse S Rs.40 per ton
From factory B to warehouse T Rs.60 per ton
Find the least cost shipping schedule.
Optimal Solution of a Transportation
Problem
If the number of positive allocations at any stage
of feasible solution is equal to (c+r-1), the next
step is to determine whether this solution is the
best or least cost solution. So an optimal
solution is one in which there is no opportunity
cost i.e., no other set of transportation route.
Opportunity Cost = Implicit – Actual Cost

Continued……….
If none of the empty cells has a positive
opportunity cost , the solution is optimal, if any
empty cells have a positive opportunity cost the
solution is not optimal and call for revision.
The actual transportation cost for each
occupied cell and unoccupied cell are written in
top left hand corner of each cell. The implicit
costs are written in bottom right hand corner of
each cell. The implicit cost is the sum of cost of
reception (Ui) and Cost of Delivery (Vj). So
Implicit Cost (Cij)= Reception Cost(Ui)+Delivery Cost(Vj)
Continued……….
In case of occupied cells implicit cost is always
equal to actual transportation cost. But for the
empty cell implicit cost will be calculated with
the help of Ui and Vj.
Methods of Optimal Solution of a
Transportation Problem
1. Modified Distribution (MODI) Method
2. Steeping Stone Method
Modified Distribution (MODI) Method
This Method is also known as u-v method. It is
widely used for finding an optimal solution by
evaluating empty cells. The following steps are
taken in MODI method to reach the optimal
solution -
 Main Step for the test of
Optimality(MODI Method)
 Determine an initial basic feasible solution
consisting of m+n-1 allocations using any of the
three methods.
 Write the implicit cost of all the occupied cells.
 Compute the Ui and Vj for each row and column.
 Compute the implicit cost of all unoccupied cells.
 Select the unoccupied cell with the largest positive
opportunity cost.
 Draw a closed path for the selected unoccupied
cell.
 Assign (+) and (-) signs alternatively in the cells
on each turn of the loop, begin it with (+) sign.
 Observe the cell which has maximum allocation .
In this cell we allocate ø (pronounced as theta)
and adjust the corresponding rows and column to
nullified the effect of theta.
 Observe the minimum negative value of theta.
And used it to nullified the effect of theta. Further
other cells will remain unchanged in which theta
is not used.
 Again calculate opportunity cost for each cell and
test the optimality.
 Rules for Drawing a Closed Path or Loop
For finding optimal solution trace a closed path in the
matrix-
 It begins and terminates in the identified cell.
 It consists of a series of alternate horizontal and
vertical lines only (never diagonals).
 It can be traced close wise or anticlockwise.
 All other corners of the path lie in the allocated cells.
 The path may skip over any number of allocated or
vacant cells.
 There will always be only one closed path.
 The closed path has always even number of corners.
 The closed path may or may not be square or
rectangular in shape , it may have peculiar
configuration.
 Determine an optimal shipping schedule from
the following-

Factory Market Available

M1 M2 M3 M4
F1 13 11 15 20 8
F2 17 14 12 13 24
F3 18 18 15 12 28
Requirement
12 12 16 20
 Self Practice
A product is produced by four factories A,B,C and
D. the unit production costs in them are Rs. 2,
Rs.3, Rs.1 and 5 respectively. Their production
capacities are A- 50 units, B-70 units , C- 30 units
and D- 50 units. These factory supplies in 4 stores
demand of which 1-25 units, 2-35 units, 3- 105
and 4- 20 units. Unit transport cost in rupees from
each factory to store are as follows-
 Stores
Factories 1 2 3 4
A 2 4 6 11
B 10 8 7 5
C 13 3 9 12
D 4 6 8 3
Determine the optimal route plan so that the total
cost is minimum.
Degeneracy in Transportation Problem
We know that if c+r-1 = number of allocated
cells, the solution is reached. But if c+r-1 ≥
number of allocated cells, we call it the problem
of degeneracy. For solving such problems, we
make the number of allocated cells equal to c+r-1
by allocating a very small positive quantity
called epsilon (£) to one or more empty cells.
The epsilon such a small quantity that the
addition or subtraction does not effect the
quantity in which it added or subtracted.
 Steps to allocate Epsilon
 If degeneracy occurs during initial solution,
then we allocate £ to that empty cell in which
transportation cost is minimum. It is
remembered that £ is not allocated to that cell
which has a zero transportation cost.
 if degeneracy occurs during optimal solution the
above procedure should be followed.
 Degeneracy in Transportation
A company has three plants with capacities of 60,
70 and 80 units respectively with to meet the
demands of three warehouse with 50, 80 and 80
units. From the following transportation cost
chart find the optimal transportation plan-
Plants Warehouse
A B C
X 8 7 3
Y 3 8 9
Z 11 3 5
Maximization Transportation Problem
Mostly transportation problems are used to
minimize shipping cost but if the information in
any problem is used to maximize profit. To solve
such problems we pick up the highest profit
value from the matrix and all the values are
subtracted from this highest value. After
obtaining new matrix , same procedure as
discussed earlier is applied.
 Maximization Transportation Problem
Solve the following transportation problem for
maximum profit:
Warehouse Market
A B C D
X 12 18 6 25
Y 8 7 10 18
Z 14 3 11 20
Availability at Warehouse Demand in Markets
X:200 units A:180 units
Y:500units B: 320units
Z:300units C: 100units
D: 400 units
 Assignment of Transportation
1. A company has 3 plants A,B and C from which
it supplies to 4 markets W,X,Y and Z. Determine
the optimum transportation plan from the
following table :
Plant Markets Availability
W X Y Z
A 13 11 15 20 2
B 17 14 12 13 6
C 18 18 15 12 7
Requirement 3 3 4 5 15
 2. The following tables give the factory to
warehouse transportation costs, find an initial
basic feasible solution by VAM method:
Factory Warehouse Available
A B C D
F1 10 22 10 20 8
F2 15 20 12 8 13
F3 20 12 10 15 11
Demand 7 10 6 9 32