Coeff x Coeff y RHS Cuts x Cuts y x -5 -4

Constraint1 -1 3 10 NA 3.333333 Con1 - y 1.666667 2

Constraint2 1 1 6 6 6 Con2 - y 11 10
Constraint3 1 -1 2 2 NA Con3 - y -7 -6
Objective 1 5 0 Profit 1 0.8

y -5 -4
Put values Con1 - x -25 -22
Con2 - x 11 10
Intersection points and Objective value Con3 - x -3 -2
C1 & C2 -0.25 0.75 2 22 Profit 25 20
0.25 0.25 4

C2 & C3 0.5 0.5 4 14

0.5 -0.5 2

-1 3 10
1 -1 2

C1 & C3 0.5 1.5 8 38

0.5 0.5 6

-30 -20
 -3 -2 -1 0 1 2 3 4 5
2.333333333 2.666666667 3 3.333333333 3.666666667 4 4.333333 4.666667 5
9 8 7 6 5 4 3 2 1
-5 -4 -3 -2 -1 0 1 2 3
0.6 0.4 0.2 0 -0.2 -0.4 -0.6 -0.8 -1

-3 -2 -1 0 1 2 3 4 5
-19 -16 -13 -10 -7 -4 -1 2 5
9 8 7 6 5 4 3 2 1
-1 0 1 2 3 4 5 6 7
15 10 5 0 -5 -10 -15 -20 -25
12

10

0
-30 -20 -10 0 10 20 30
-2

-4

-6

-8
 Constraint 1
Constraint 2
Constraint 3
Objective
Constraint 1
Constraint 2
30 Constraint 3
Objective
 -1 -5 0 0 0 0 -2 2/3 0 1 2/3
-1 3 1 0 0 10 - 1/3 1 1/3
1 1 0 1 0 6 1 1/3 0 - 1/3
1 -1 0 0 1 2 2/3 0 1/3

-2 2/3 0 1 2/3 0 0 16 2/3 0 0 1

- 1/3 1 1/3 0 0 3 1/3 0 1 1/4
1 1/3 0 - 1/3 1 0 2 2/3 1 0 - 1/4
2/3 0 1/3 0 1 5 1/3 0 0 1/2
 0 0 16 2/3
0 0 3 1/3
1 0 2 2/3 2
0 1 5 1/3 8

2 0 22
1/4 0 4
3/4 0 2
- 1/2 1 4
 Coeff x Coeff y RHS
Constraint1 -1 3 10
Constraint2 1 1 6
Constraint3 1 -1 2
Objective 1 5 20
Total Demand 70
Ordering cost/order 40.05 45.05 55.44
Inventory holding cost (percentage of product cost) 20%
Product cost/unit 18 16 13
Inventory holding cost/unit inventory 3.6 3.2 2.6
Minimum order quantity for product price 0 >40 >50
Maximum order quantity for product price 40 50 70

Order quantity = demand ordered at one time

Total cost = Ordering costXTotal orders + Average inventory holding cost
Total orders = Total demand/order quantity
Average inventory = Total order/2
If number of orders are increased, order quantity reduces, inventory cost reduces, but total ordering cost increases
If number of orders are decreased, order quantity increases, inventory cost increases, but total ordering cos

For graph:
Order quantity (Decision variable) O I No. of O Avg I
1 40.05 3.6 70 0.5
2 40.05 3.6 35 1
3 40.05 3.6 23.33333 1.5
4 40.05 3.6 17.5 2
5 40.05 3.6 14 2.5
6 40.05 3.6 11.66667 3
7 40.05 3.6 10 3.5
8 40.05 3.6 8.75 4
9 40.05 3.6 7.777778 4.5
10 40.05 3.6 7 5
11 40.05 3.6 6.363636 5.5
12 40.05 3.6 5.833333 6
13 40.05 3.6 5.384615 6.5
14 40.05 3.6 5 7
15 40.05 3.6 4.666667 7.5
16 40.05 3.6 4.375 8
17 40.05 3.6 4.117647 8.5
18 40.05 3.6 3.888889 9
19 40.05 3.6 3.684211 9.5
20 40.05 3.6 3.5 10
21 40.05 3.6 3.333333 10.5
22 40.05 3.6 3.181818 11
23 40.05 3.6 3.043478 11.5
24 40.05 3.6 2.916667 12
25 40.05 3.6 2.8 12.5
26 40.05 3.6 2.692308 13
27 40.05 3.6 2.592593 13.5
28 40.05 3.6 2.5 14
29 40.05 3.6 2.413793 14.5
30 40.05 3.6 2.333333 15
31 40.05 3.6 2.258065 15.5
32 40.05 3.6 2.1875 16
33 40.05 3.6 2.121212 16.5
34 40.05 3.6 2.058824 17
35 40.05 3.6 2 17.5
36 40.05 3.6 1.944444 18
37 40.05 3.6 1.891892 18.5
38 40.05 3.6 1.842105 19
39 40.05 3.6 1.794872 19.5
40 40.05 3.6 1.75 20
41 45.05 3.2 1.707317 20.5
42 45.05 3.2 1.666667 21
43 45.05 3.2 1.627907 21.5
44 45.05 3.2 1.590909 22
45 45.05 3.2 1.555556 22.5
46 45.05 3.2 1.521739 23
47 45.05 3.2 1.489362 23.5
48 45.05 3.2 1.458333 24
49 45.05 3.2 1.428571 24.5
50 45.05 3.2 1.4 25
51 55.44 2.6 1.372549 25.5
52 55.44 2.6 1.346154 26
53 55.44 2.6 1.320755 26.5
54 55.44 2.6 1.296296 27
55 55.44 2.6 1.272727 27.5
56 55.44 2.6 1.25 28
57 55.44 2.6 1.22807 28.5
58 55.44 2.6 1.206897 29
59 55.44 2.6 1.186441 29.5
60 55.44 2.6 1.166667 30
61 55.44 2.6 1.147541 30.5
62 55.44 2.6 1.129032 31
63 55.44 2.6 1.111111 31.5
64 55.44 2.6 1.09375 32
65 55.44 2.6 1.076923 32.5
66 55.44 2.6 1.060606 33
67 55.44 2.6 1.044776 33.5
68 55.44 2.6 1.029412 34
69 55.44 2.6 1.014493 34.5
70 55.44 2.6 1 35
 Variable: order quantity 40

IF function: Ordering cost/order 40.05

IF function: Inventory holding cost/unit 3.6

Objective: Total cost 142.0875

otal ordering cost increases

y cost increases, but total ordering cost decreases

Chart Title
Total cost (Objective)
2805.3 143.4
1405.35 143.2
939.9
708.075 143
569.7 142.8
478.05
142.6
413.1
364.8375 142.4
327.7
142.2
298.35
274.663636363636 142
1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 58 61 64 67 70
255.225
239.053846153846
225.45
213.9
204.01875
195.511764705882
188.15
181.752631578947
176.175
171.3
167.031818181818
163.291304347826
160.0125
157.14
154.626923076923
152.433333333333
150.525
148.872413793103
147.45
146.235483870968
145.209375
144.354545454545
143.655882352941
143.1
142.675
142.37027027027
142.176315789474
142.084615384615
142.0875
142.514634146341
142.283333333333
142.137209302326
142.070454545455
142.077777777778
142.154347826087
142.295744680851
142.497916666667
142.757142857143
143.07
142.394117647059
142.230769230769
142.122641509434
142.066666666667
142.06
142.1
142.184210526316
142.310344827586
142.476271186441
142.68
142.919672131148
143.193548387097
143.5
143.8375
144.204615384615
144.6
145.022388059702
145.470588235294
145.94347826087
146.44
61 64 67 70
 Coeff x Coeff y Coeff z RHS (values) LHS (formula)
Constraint1 2 4 3 240 0
Constraint2 2 2 3 140 0
Constraint3 3 2 4 200 0
Objective 5 4 6

x-value y-value z-value

Variables 0 0 0

Objective 0
Project 1 2 3 4 5 6 7 8
Year 1 outflow 12 54 6 6 30 6 48 36
Year 2 outflow 3 7 6 2 35 6 4 3
NPV 14 17 17 15 40 12 14 10
 9
18
3
12
Type Alloy 1 Alloy 2 w1 w2 cost
Cost per ton 190 200
Percent silicon 2 2.5
Percent nickel 1 1.5
Percent carbon 3 4
Tensile strength (psi) 42,000 50,000