IM423 – Operations Research

IM423 – Operations Research

A Product Mix Example

Problem Definition (1 of 6)
 Four-product T-shirt/sweatshirt manufacturing company.
 Must complete production within 72 hours
 Truck capacity = 1,200 standard sized boxes.
 Standard size box holds 12 T-shirts.
 One-dozen sweatshirts box is three times size of standard box.
 $25,000 available for a production run.
 500 dozen blank T-shirts and sweatshirts in stock.
 How many dozens (boxes) of each type of shirt to produce?

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 2
Department of Industrial and Management Engineering

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IM423 – Operations Research

A Product Mix Example (2 of 6)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 3
Department of Industrial and Management Engineering

A Product Mix Example

Data (3 of 6)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 4
Department of Industrial and Management Engineering

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IM423 – Operations Research

A Product Mix Example

Model Construction (4 of 6)
 Decision Variables:
• x1 = number of boxes of sweatshirts, front printing to produce
• x2 = number of boxes of sweatshirts, back and front printing to produce
• x3 = number of boxes of T-shirts, front printing to produce
• x4 = number of boxes of T-shirts, back and front printing to produce
 Objective Function:
• Maximize Z = $90x1 + $125x2 + $45x3 + $65x4
 Model Constraints:
• 0.10x1 + 0.25x2 + 0.08x3 + 0.21x4  72 hr
• 3x1 + 3x2 + x3 + x4  1,200 boxes
• $36x1 + $48x2 + $25x3 + $35x4  $25,000
• x1 + x2  500 dozen sweatshirts
• x3 + x4  500 dozen T-shirts
• x1, x2, x3, x4  0

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 5
Department of Industrial and Management Engineering

A Product Mix Example

Computer Solution with Excel (5 of 6)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 6
Department of Industrial and Management Engineering

Copyright © 2011, Khaled S. El-Kilany, Ph.D.

Department of Industrial and Management Engineering 3
IM423 – Operations Research

A Product Mix Example

Solution with Excel Solver Window (6 of 6)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 7
Department of Industrial and Management Engineering

A Diet Example
Data and Problem Definition (1 of 5)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 8
Department of Industrial and Management Engineering

Copyright © 2011, Khaled S. El-Kilany, Ph.D.

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IM423 – Operations Research

A Diet Example
Model Construction – Decision Variables (2 of 5)
 x1 = cups of bran cereal
 x2 = cups of dry cereal
 x3 = cups of oatmeal
 x4 = cups of oat bran
 x5 = eggs
 x6 = slices of bacon
 x7 = oranges
 x8 = cups of milk
 x9 = cups of orange juice
 x10 = slices of wheat toast

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 9
Department of Industrial and Management Engineering

A Diet Example
Model Summary (3 of 5)
 Minimize
• Z = 0.18x1 + 0.22x2 + 0.10x3 + 0.12x4 + 0.10x5 + 0.09x6 + 0.40x7 +
0.16x8 + 0.50x9 + 0.07x10
 Subject to:
• 90x1 + 110x2 + 100x3 + 90x4 + 75x5 + 35x6 + 65x7 + 100x8 + 120x9 +
65x10  420
• 6x1 + 4x2 + 2x3 + 3x4 + x5 + x7 + x10  5
• 20x1 + 48x2 + 12x3 + 8x4 + 30x5 + 52x7 + 250x8 + 3x9 + 26x10  400
• 3x1 + 4x2 + 5x3 + 6x4 + 7x5 + 2x6 + x7 + 9x8 + x9 + 3x10  20
• 5x1 + 2x2 + 3x3 + 4x4 + x7 + 3x10  12
• 2x2 + 2x3 + 2x4 + 5x5 + 3x6 + 4x8 + x10  20
• 270x5 + 8x6 + 12x8  30
• xi  0, for all i

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 10
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

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IM423 – Operations Research

A Diet Example
Computer Solution with Excel (4 of 5)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 11
Department of Industrial and Management Engineering

11

A Diet Example
Solution with Excel Solver Window (5 of 5)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 12
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

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IM423 – Operations Research

A Marketing Example
Data and Problem Definition (1 of 4)
 Budget limit $100,000
 Television time for four commercials
 Radio time for 10 commercials
 Newspaper space for 7 ads
 Resources for no more than 15 commercials and/or ads

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 13
Department of Industrial and Management Engineering

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A Marketing Example
Model Summary (2 of 4)
 Maximize Z = 20,000x1 + 12,000x2 + 9,000x3
 subject to:
• 15,000x1 + 6,000x2 + 4,000x3  100,000
• x1  4
• x2  10
• x3  7
• x1 + x2 + x3  15
• x1, x2, x3  0
 where
• x1 = Number of Television Commercials
• x2 = Number of Radio Commercials
• x3 = Number of Newspaper Ads

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 14
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

Department of Industrial and Management Engineering 7
IM423 – Operations Research

A Marketing Example
Solution with Excel (3 of 4)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 15
Department of Industrial and Management Engineering

15

A Marketing Example
Solution with Excel Solver Window (4 of 4)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 16
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

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IM423 – Operations Research

LP Applications

 Diet Problem Example

 The Feed ‘N Ship feedlot fattens cattle for local farmers and
ships them to meat market in different cities.
 The owners of the feedlot stock seek to determine the
amounts of cattle feed to buy to satisfy minimum nutritional
standards and, at the same time, minimize total feed costs.
Feed (ounce/pound)
Product Stock X Stock Y Stock Z
A 3 oz 2 oz 4 oz
B 2 oz 3 oz 1 oz
C 1 oz 0 oz 2 oz
D 6 oz 8 oz 4 oz

Dr. Khaled S. El-Kilany

IM423 – Operations Research 17
Department of Industrial and Management Engineering

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LP Applications

 The cost per pound of grains X, Y, and Z is $0.02, $0.04, and

$0.025, respectively.
 The minimum requirements per cow per month is 64 ounces
of A, 80 ounces of B, 16 ounces of C, and 128 ounces of D.
 Another constraint that faces feedlot is a restriction on the
amount of stock Z to use per cow, which is no more than 8
pounds.

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 18
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

Department of Industrial and Management Engineering 9
IM423 – Operations Research

LP Applications

 Decision Variables
• X1 = number of pounds of stock X purchased per cow each month
• X2 = number of pounds of stock Y purchased per cow each month
• X3 = number of pounds of stock Z purchased per cow each month
 Objective Function
• Minimize cost = 0.02X1 + 0.04X2 + 0.025X3
 Constraints
• Ingredient A requirement: 3X1 + 2X2 + 4X3 ≥ 64
• Ingredient B requirement: 2X1 + 3X2 + 1X3 ≥ 80
• Ingredient C requirement: 1X1 + 0X2 + 2X3 ≥ 16
• Ingredient D requirement: 6X1 + 8X2 + 4X3 ≥ 128
• Stock Z limitation: X3 ≤ 8
• Non-negativity: X1, X2, X3 ≥ 0

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 19
Department of Industrial and Management Engineering

19

A Transportation Example
Problem Definition and Data (1 of 3)
 Warehouse supply of TVs:  Retail store demand for TVs:
 1 - Cincinnati 300  A - New York 150
 2 - Atlanta 200  B - Dallas 250
 3 - Pittsburgh 200  C - Detroit 200
 Total 700  Total 600

Unit Shipping Costs:

To Store
From Warehouse A B C
1 $16 $18 $11
2 14 12 13
3 13 15 17

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 20
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

Department of Industrial and Management Engineering 10
IM423 – Operations Research

A Transportation Example
Model Summary (2 of 4)
 Decision variables: subject to:
Xij: number of TVs to ship from • Capacity Constraints
warehouse i to retail store j x1A + x1B + x1C  300
• i= 1,2,3 and j=A, B, C x2A+ x2B + x2C  200
x3A+ x3B + x3C  200
• Demand Constraints
 Minimize Z = $16x1A + 18x1B
x1A + x2A + x3A = 150
+ 11x1C + 14x2A + 12x2B +
x1B + x2B + x3B = 250
13x2C + 13x3A + 15x3B + 17x3C
x1C + x2C + x3C = 200
• Non-negativity Constraints
All xij  0

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 21
Department of Industrial and Management Engineering

21

A Transportation Example
Solution with Excel (3 of 4)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 22
Department of Industrial and Management Engineering

22

Copyright © 2011, Khaled S. El-Kilany, Ph.D.

Department of Industrial and Management Engineering 11
IM423 – Operations Research

A Transportation Example
Solution with Solver Window (4 of 4)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 23
Department of Industrial and Management Engineering

23

A Blend Example
Problem Definition and Data (1 of 5)

Maximum Barrels
Component Cost/barrel
Available/day
1 4,500 $12
2 2,700 10
3 3,500 14

Grade Component Specifications Selling Price ($/bbl)

At least 50% of 1
Super $23
Not more than 30% of 2
At least 40% of 1
Premium 20
Not more than 25% of 3
At least 60% of 1
Extra 18
At least 10% of 2

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 24
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

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IM423 – Operations Research

A Blend Example
Problem Statement and Variables (2 of 5)
 Determine the optimal mix of the three components in each
grade of motor oil that will maximize profit.
 Company wants to produce at least 3,000 barrels of each
grade of gasoline.
 Decision variables:
• The quantity of each of the three components used in each grade of
gasoline (9 decision variables)
• xij = barrels of component i used in motor oil grade j per day, where i =
1, 2, 3 and j = s (super), p (premium), and e (extra).

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 25
Department of Industrial and Management Engineering

25

A Blend Example
Model Summary (3 of 5)
 Max Z = 11x1s + 13x2s + 9x3s + 8x1p + 10x2p + 6x3p + 6x1e + 8x2e + 4x3e
 Subject to:
x1s + x1p + x1e  4,500
x2s + x2p + x2e  2,700
x3s + x3p + x3e  3,500
0.50x1s - 0.50x2s - 0.50x3s  0
0.70x2s - 0.30x1s - 0.30x3s  0
0.60x1p - 0.40x2p - 0.40x3p  0
0.75x3p - 0.25x1p - 0.25x2p  0
0.40x1e - 0.60x2e - 0.60x3e  0
0.90x2e - 0.10x1e - 0.10x3e  0
x1s + x2s + x3s  3,000
x1p + x2p + x3p  3,000
x1e + x2e + x3e  3,000
xij  0

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 26
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

Department of Industrial and Management Engineering 13
IM423 – Operations Research

A Blend Example
Solution with Excel (4 of 5)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 27
Department of Industrial and Management Engineering

27

A Blend Example
Solution with Solver Window (5 of 5)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 28
Department of Industrial and Management Engineering

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Copyright © 2011, Khaled S. El-Kilany, Ph.D.

Department of Industrial and Management Engineering 14
IM423 – Operations Research

Energy Resource Allocation (1 of 6)

 An industrial establishment uses energy for heating, cooling,

and power.
 Current sources of energy:
• conventional electric power
• natural gas
 Potential source of energy:
• solar energy

 The objective is to find an optimal mix of three different

sources of energy to meet the plant’s energy requirements at
minimum total annual cost.

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 29
Department of Industrial and Management Engineering

29

Energy Resource Allocation (2 of 6)

 The energy sources (solar, commercial electricity grid, and natural gas) are
used to power devices to meet energy needs for cooling, heating, and
power.

 Plant minimum requirements (kWh)

Heating Cooling Power

1,800,000 1,200,000 900,000

 The solar energy system is expected to supply at least 1,075,000 kWh

annually.
 The annual use of commercial electric grid must be at least 1,900,000 kWh
due to a prevailing contractual agreement for energy supply.
 The annual consumption of the contracted supply of gas must be at least
950,000 kWh.
 The cubic foot unit for natural gas has been converted to kWh (1 cu. ft. of
gas = 0.3024 kWh).

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 30
Department of Industrial and Management Engineering

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Department of Industrial and Management Engineering 15
IM423 – Operations Research

Energy Resource Allocation (3 of 6)

 Energy Resource Combination Data

Energy Source Minimum Conservation Credit Unit Cost
Conservation Credit Rate ($/kWh) ($/kWh)
(1,000’s)$
Solar Power 600 6 0.4
Electricity grid 800 3 0.3
Natural gas 375 2 0.05

 The conservation credits are associated with the operating

and maintenance costs.

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 31
Department of Industrial and Management Engineering

31

Energy Resource Allocation (4 of 6)

 Decision variables:
• Xij : the kilowatt-hour used from source i for purpose j
 Objective function:
Minimize 𝑧 = 0.4 (𝑥 + 𝑥 + 𝑥 ) + 0.3 (𝑥 +𝑥 +𝑥 )
+ 0.05 (𝑥 + 𝑥 + 𝑥 )
 Constraints:
• 𝑥 +𝑥 +𝑥 ≥1,800,000 • 𝑥 + 𝑥 + 𝑥 ≥1,075,000
• 𝑥 +𝑥 +𝑥 ≥1,200,000 • 𝑥 + 𝑥 + 𝑥 ≥1,900,000
• 𝑥 + 𝑥 + 𝑥 ≥950,000
• 𝑥 +𝑥 +𝑥 ≥900,000
• 𝑥 ≥ 0 , 𝑖, 𝑗 = 1,2,3
• 6(𝑥 + 𝑥 + 𝑥 ) ≥600,000
• 3(𝑥 + 𝑥 + 𝑥 ) ≥800,000
• 2(𝑥 + 𝑥 + 𝑥 ) ≥375,000

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 32
Department of Industrial and Management Engineering

32

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Department of Industrial and Management Engineering 16
IM423 – Operations Research

Energy Resource Allocation (5 of 6)

Decision variables

Constraints

Objective
function

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 33
Department of Industrial and Management Engineering

33

Energy Resource Allocation (6 of 6)

Dr. Khaled S. El-Kilany, PhD

IM423 – Operations Research 34
Department of Industrial and Management Engineering

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Department of Industrial and Management Engineering 17