Assignment 3: Solving optimization problems in R

Q1) Solving the two chemicals problem in R (Marks 1)

Max. 100X1 + 300X2

X1 + X2 < 200

-X1 + X2 < 100

X 1 , X2 > 0

Q2) (Refer the production planning problem discussed in class)

A company, making a single product, has received the following orders (demand units/day) for the
next 20 days: {900, 1000, 500, 1000, 1200, 900, 800, 1100, 1300, 1000, 1200, 700, 1000, 600, 500,
1200, 1000, 900, 1200, 1000}. It can make the product using the two modes of production

 Regular Time Production, RT capacity = 800 units/day, RT cost = Rs. 20 per unit

 Overtime Production, OT capacity = 300 units/ day, OT cost = Rs. 25 per unit

The company can also produce more on any day and carry the excess quantity to the next day as
inventory with a carrying cost (inventory cost ) of Rs. 3 per unit per day. The revenue earned from
selling each unit of the product is Rs. 50 per unit. Assume that it is mandatory to meet the demand
on the same day. Formulate a linear programming model to maximize the total profit made in these
20 days.

2a. Modify the first production planning model (Model-1) to formulate the above optimization
problem. (Class work)

2b. Solve the above problem in R. (Marks 1)

2c. If it is not mandatory to meet the demand on the same day, how can you modify the above
model (2a) to exploit this additional flexibility (back-ordering allowed)? Compare the models in 2a
and 2c and comment on the results. (Marks 3)