o

Q1.

Describe in details the different scopes of application of Operations Research.

Ans:

Whenever there is any problem simple or complex, Operation Research (OR)

techniques may be applied to derive best solutions. Scope of application of OR in
various fields of life is given below.

1. In defense Operation: In modern warfare the defense operations are carried out by
independent components namely Air Force, Army and Navy. Activities of each of
these components can be further divided in to sub components namely
Administration, Intelligence, Operations, Supplies, Training etc. The application of
modern warfare technique in each of these components requires expertise in
respective field. Further, each component works to derive maximum gains from it
operation. There is always a possibility that strategy beneficial to one component
may have an adverse effect on the other. In view of this, in defense operation there
is a necessity to co ordinate the activities of various components which gives
maximum benefit to the defense force as a whole having maximum use of individual
components. The final strategy is therefore prepared by a team of experts drawn
from various disciplines who studies the strategies of different components and after
appropriate analysis of various course of action, the best course of action (known as
optimum strategy) is chosen.

2. In Industry: The systems of modern industries are so complex that the optimum
point of operation in its various components cannot be accurately judged by
individuals. In view of the changing business environment any business decision
suitable at one time may not be so good some time. There is always a need for to
check the validity of a decision continually, against the given situation. The industrial
o

revolution has with increased division of labour and introduced management

responsibilities have made each component and independent unit with unique
goals. The goal of one component is not always complementary to that of other and
may not conform to the objective of the organization. The application OR
techniques helps in overcoming the difficulties by integrating the diversified activities
of various components so as to serve the interest of the organization as a whole.

3. Planning : Careful planning has become imperative for governments in the modern
times to ensure economic development of the nation. Since the requirement and
resources are diverse and at time one requirement is not in agreement with some
other requirement sacrifices of some factors becomes inevitable. OR techniques
can effectively be employed to maximize the per capita income with minimum
sacrifice and time. Thus a government can use OR for charting its economic
decisions and social policies in an optimum way with best use of the resources at its
commend.

4. Agriculture : The agriculture output has become a matter of paramount

importance to ensure food security of the country with world’s second largest
population. The agricultural output cannot be increased arbitrarily. There are
confliction conditions and limitation to effect the increase. Considerable studies and
planning are required towards adoption of technology, resources, man powers etc in
this field. There is a compelling need to determine the best course of action that
suites the diverse needs with constraints in resources. These issues can be solved
by application of OR techniques which will deliver the best solution with constraints
duly applied to the present economic environment.

5. In Hospitals : In big hospitals the outpatient department is usually under pressure

due to large number of patients waiting to consult the Doctors. The available
Doctors and Para Medical staff, The general Duties assigned to them, Patients
o

wanting to consult different specialists pose problem of complex nature with

contradicting demands. These problems can be effectively tackled using OR
techniques. Similar complex hospital administration problems also can be solved
using OR techniques.

6. In Transport : In railways, the station spurs available has to be effectively utilized

to accommodate maximum trains so that the waiting period of the passengers is
reduced. However, the limited spurs demands the trains be departed from the
station as quickly as possible to accommodate the incoming train. Many time the
limited station time of the train leads to passenger being hurried. Since this pose a
contradictory demand on the available station resource, the OR techniques are
adopted to arrive at best solution considering all the constraints and needs. Same
techniques are employed in goods movement and logistic arrangements so that the
quicker transshipments takes place with least warehousing time using the limited
storage space and wagons available.

7. In Research & Development: Control of R&D projects, production introduction

planning, local administration, government developmental plans etc where
competing demands and limited resources are unavoidable, OR techniques can be
effectively used to arrive at the best solution under the given constraints.
o

Q2.

What do you understand by Linear Programming Problem? What are the

Requirements of L.P.P.? What are the basic assumptions of L.P.P.?

Ans:

1. Linear Programming Problem.

Competing demands with limited resources pose imposing challenges on the

business managers in the competitive business environment. Linear Programming
Problems represent the objective and constraints in the form of linear mathematical
equations (C1X1+ C2X2 + …….+CnXn = Z). Being linear equations, their graphical
representations are essentially straight lines and therefore represent the boundary
conditions.

In many situations the output or set of outputs can be represented as a linear

relationship among the number of variables. The available resources can also be
o

expressed as a liner relationship among some system variables. The management

problem of optimizing the output ( Maximizing Profit or Minimizing Expenditure etc.)
with constraints both of which are transformed in to liner equations, represent Liner
Programming Problem. These mathematical problems have unique solutions and
there for aid the management to get best option under the given conditions of
constraints.

2. Requirement of L.P.P.

The requirement of LPP are :

1. Decision variables and their relationship.

2. Well defined objective function.

3. Existence of alternative course of action

4. Non-negative conditions of decision variables.

3. Basic assumptions of L.P.P.

1. Linearity: Both objective functions and constraints must be expressed as linear

in-equalities.

2. Deterministic: All coefficients of decision variables in the objective and

constraints expressions should be known and finite.

3. Additivity: The value of the object function for the given values of decision
variable and the total sum of resources used, must be equal to the sum of the
o

contributions earned from each decision variable and sum of the resources used
by decision variable respectively.

4. Divisibility: The solution of decision variables and resource can be any non-
negative values including fractions.
o

Q3 Describe the different steps needed to solve a problem by simplex method.

The steps need to solve problem by Simplex Method are

1. Introduce slack variable (S1 S ) for < or = type of constraints.

2. Introduce surplus variable (S1S ) and artificial Variable (A) for > or = type of
constraints.

3. Introduce only artificial variable for “ = “ type of problems.

4. Cost (C1) of slack and surplus variable will be zero and that of artificial
variable will be “M”

5. Find Zj-Cj for each variable.

6. Slack and Artificial variables will form basic variable for the first Simplex
Table. Surplus variable will never become the basic variable for the for the
first simplex table.

7. Zj= Sum of ( Cost of variables x its coefficients in the constraints- Profit or

cost coefficient of the variable)

8. Select the most negative value of the Zj-Cj. That column is called the key
column. The variable corresponding to this column will become the basic
variable for the next table.
o

9. Divide the quantities by corresponding values of the key column to get ratios
and select the minimum ratio. This becomes the key row. The basic variable
corresponding to this row will be replaced by the variable fond in step 6

10. The element that lies both in key column and key row is called Pivotal
Element

11. Ratio with negative values and “ α ” are not considered for determining the
key row.

12. Once an artificial variable is removed as basic variable, its column will be
deleted from the next iteration.

13. For maximization problems decision variables coefficient will be same as in

the objective function. For minimization problem decision variables
coefficients will have opposite signs as compared to objective function.

14. Value of artificial variable is always –M for both maximization and

minimization problems.

15. The process is continued till Zj-Cj = 0

Q4. Describe the economic interpretation of the Duality concept.

The economic interpretation of the dual problem depends on the economic situation
embodied in the primal problem. Therefore, we can only explore an approach for
developing an economic interpretation.
Thus, consider profit-maximization, product-mix, primal example:
Find x1 , x 2 , x 3 and z to :
Maximize z =1000 x1 +1200 x 2 + 900 x3

s u b je c t :to 3x1 + 5 x2 + 4 x3 ≤ 8 0
5 x1 + 6 x2 + 4 x3 ≤ 4 8 0
1x1 + 0.5 x2 + 0.7 x3 ≤ 1 0
x j ≥ 0 fo r j = 1,2,3
And its dual:
o

Find u1 , u 2 , u 3 and v to :
Minimize v = 80 u1 + 480 u 2 +10 u3

su b je c t :to 3u1 + 5u 2 + 1u3 ≥ 1 0 0 0

5u1 + 6u 2 + 0.5u3 ≥ 1 2 0 0
4u1 + 4u 2 + 0.7u3 ≥ 9 0 0
ui ≥ 0 fo ri = 1,2,3
The primal problem in this example represents a realistic situation so that the data and
variables in the model possess dimensional units and interpretations. The model
maximizes profit subject to constraints that prevent using more resources than are
available. The question that should come to our mind is, “What are the dimensional
units of the dual variables and what is the interpretation of the dual problem?” To gain
insight into these questions, we start by expressing the primal problem with dimensional
units included in the model. For this we use the abbreviation:

upi to represent the number of units of product i to be produced,

mhr to represent machine hours,
lhr to represent labor hours, and
$ to represent profit dollars.
Primal problem with dimensional units:
Find x1 , x 2 , x 3 and z to :
Maximize z ($ / wk ) = 1000 ($ / up1) x1 (up 1 / wk ) +1200 ($ / up 2) x 2 (up 2 / wk ) + 900 ($ / up 3) x3 (up 3 / wk )

subject to:
3( mhr / up1) x1 (up1 / wk ) + 5( mhr / up 2 ) x2 (up 2 / wk ) + 4( mhr / up 3) x3 (up 3 / wk ) ≤ 80 ( mhr / wk )
5(lhr / up1) x1 (up1 / wk ) + 6(lhr / up 2 ) x2 (up 2 / wk ) + 4(lhr / up 3) x3 (up 3 / wk ) ≤ 480 (lhr / wk )
1(tons / up1) x1 (up1 / wk ) + 0.5(tons / up 2 ) x2 (up 2 / wk ) + 0.7(tons / up 3) x3 (up 3 / wk ) ≤10 (tons / wk )
x j ≥ 0 for j = 1,2,3

Now consider the first constraint of the dual problem with dimensional units placed on
the data only.

3( mhr / up 1)u1 +5( lhr / up 1)u 2 +1( tons / up 1)u 3 ≥1000 ($ / up 1)

Since the dimensional units on the left hand side of a constraint must match the
dimensional units on the right hand side of the constraint, then it is easily seen that the
dimensional units for u i must be $/mhr when i = 1, $/lhr when i = 2, and $/ton when i =
3.
o

It is now possible to interpret the dual problem and its variables in the context of a
product mix primal problem. Each dual variable decides on a monetary value for one
unit of each of the resources consumed in the production of our products. In deciding
on these values the dual problem seeks to minimize the total value (in profit $) of all the
resources that are available each week. Each structural dual constraint ensures that
the total value assigned to the resources used by each unit of a product is at least as
large as the profit earned by a unit of that product. The value assigned by the dual
problem to the resources is an internal value determined only by the profit that can be
generated by producing the products. In other words it is not a real value such as the
cost of buying the resource on the open market. The actual cost of the resources is
determined in the market places for labor, machines, and the raw material and has
nothing to do with the internal value decided by the dual problem.
Suppose that another manufacturer wants to rent our machinery, rent our labor force,
and buy our raw materials from us. The manufacturer may prefer to buy the raw
materials on the open market, but since we have a long-term contract to take delivery of
the raw material supply every week, we would insist that he buy them from us as part of
the rental deal. Similarly, he may prefer to hire his own labor force, but out of loyalty to
our employees we would insist that we keep them on payroll and he simply rent the
labor from us. A key question is what weekly rate above our direct costs should the
other manufacturer pay for the equipment, the labor and the materials? In other words,
what is the total direct profit we should receive from renting our resources instead of
using them to produce our products? The dual variables, then, are the decision
variables to answer that question. The dual objective function: v = 80 u1 + 480 u 2 +10 u3
represents the total amount of profit, in excess or our direct cost, the manufacturer
would pay to rent our equipment, labor, and to buy our materials. Naturally, the other
manufacturer would like to minimize that total amount as is done in the dual problem.
Now consider the dual constraints:

3u1 + 5u 2 + 1u3 ≥ 1 0 0 0
5u1 + 6u 2 + 0.5u3 ≥ 1 2 0 0
4u1 + 4u 2 + 0.7u3 ≥ 9 0 0
ui ≥ 0 fo ri = 1,2,3
The left hand side of the first constraint represents the profit (from renting) that would be
made on exactly those resources required to for us to manufacture one unit of product
1. The right hand side of the constraint is the amount of profit we make from selling one
unit of product 1. So the constraint indicates that the vector of profits per unit of
resource, (u1 , u 2 , u3 ) , must earn at least as much profit on the resources required to
make product 1 as the profit on product 1 — otherwise, we would prefer not to rent out
equipment and labor and sell the raw materials. Similarly, constraints 2 and 3 ensure
that the profit on renting resources needed to manufacture products 2 and 3 is at least
as good as the profit from selling the products.
Thus, the dual problem belongs to the other manufacturer who is trying to figure out
what monetary offer she should make to rent our property, our labor, and buy our
o

supplies in order to minimize the profit we would make (and her costs) while at the
same time knowing that the offer is constrained to be good enough to encourage us to
take the offer instead of manufacturing our own products.

Q5. How can you use the Matrix Minimum method to find the initial basic
feasible solution in the transportation problem.

Ans:
Step 1 : Determine the smallest cost in the cost matrix of the transportation table.
Let it be cij. Allocate xij = min (a,b) in the cell (I,j)

Step 2 : If xij=ai cross off the ith row of the transportation table and decrease aj by
bj go to step 3.

If xij = aj = bj cross off either the ith row or the ith column, but not both.
o

Step 3: Repeat steps1 and 2 for the resulting reduced transportation table until
all the rim requirement are satisfied whenever the minimum cost is not unique
make an arbitrary choice amoung the minima.

Q6. Describe the Integer Programming Problem. Describe the Gomory’s All-
I.P.P. method for solving the I.P.P. problem.

1. The Integer Programming Problem (IPP) is a special Linear Programming

Problem where all or some variable are constrained to assume non-negative
integer values. This type of problem has lot of application in business and
industry where quite often discrete nature of the variable in involved in many
decision making solution.
o

2. Gomory’s All- IPP Method: An optimum solution to an IPP is first obtained by

using Simplex method ignoring the restriction of integral values. In optimum
solution if the variables have integer values, the current solution will be
described as optimum Integer solution. Otherwise the given IPP is modified
by inserting by inserting a new constraint called Gomory’s or secondary
constraint which represents necessary condition for integrability and
eliminate some non linear solution without loosing any integral solution. After
adding the secondary constraint the problem is solved by dual Simplex
method to get an optimum integral solution. If all the values of the variable in
the problem are integer, an optimum integer solution is obtained. Otherwise
another new constraint is added to the modified LPP and the procedure is
repeated. An optimum integer solution will be reached eventually after
introducing enough new constraints to eliminate all the superior non integer
solutions.