Decision Making (Group Assignment)

Question 1
Our objective is to find the number of heart valves of each size that have to be procured from
each supplier at the lowest cost. We have three suppliers, whom we denote by S1, S2 and S3.
We also need three sizes of valves, which we denote by small, medium and large.
We also have constraints on the supplier capacity and the number of valves of each size. We
have modelled the constraints in the following way:
DECISION VARIABLES:
S1= supply of valves from Supplier 1
S2= supply of valves from Supplier 2
S3= supply of valves from Supplier 3
We make the following equations/ inequations depending upon the constraints given:
OBJECTIVE FUNCTION: Our objective function is to minimise the cost of procuring valves
from the three suppliers.
Price of valves from Supplier 1= Rs 20 denoted by P1
Price of valves from Supplier 2= Rs 16 denoted by P2
Price of valves from Supplier 3= Rs 12 denoted by P3
Hence our objective function would be:
Min: Cost=P1*S1+P2*S2+P3*S3


1) We have constraints regarding the composition of the number of valves from each
supplier.

Let S1= sum of all valves from S1; likewise S2 for valves from S2 and S3 for valves
from S3.
S1 small= 0.4 S1
S1 medium= 0.4 S1
S1 large= 0.2 S1
S2 small= 0.3 S2
S2 medium= 0.35 S2
S2 large= 0.35 S2
S3 small= 0.2 S3
S3 medium= 0.2 S3
S3 large= 0.6 S3

Hence we make three variables S1, S2 and S3.

2) Atleast 500 large, 300 medium and 300 small valves must be purchased each month.

S1 *0.2+ S2*0.35 + S3*0.6 >= 500
S1*0.4+ S2*0.35 + S3*0.2 >= 300
S1*0.4 + S2*0.35 + S3*0.2 >= 300

3) At most 500 valves per month can be purchased from each supplier.

S1 <= 500
S2 <= 500
S3 <= 500

Using these constraints, in the solver we get the solution for our objective function:

Cost= 16500 rupees

S1= 125 units
Small= 50 units
Medium= 150 units
Large= 100 units

S2= 500 units
Small= 50 units
Medium= 175 units
Large= 100 units

S3=500 units
Small= 25 units
Medium= 175 units
Large= 300 units