Advertising Models

2. Suppose, as a matter of corporate policy, that General Flakes decides not to advertise on the “Rachael Ray”
show. Modify the original advertising model appropriately and find the new optimal solution. How much has it
cost the company to make this policy decision?
The new total cost is 1,885.714. The original cost was 1,870 so there is an additional cost of 15.714.

4. Suppose that General Flakes decides that it shouldn’t place any more than 10 ads on any given show.
Modify the (original) advertising model appropriately to incorporate this constraint, and then reoptimize (with
integer constraints on the numbers of ads). Finally, run SolverTable to see how sensitive the optimal solution is
to the maximum number of ads per show allowed. You can decide on a reasonable range for the sensitivity
analysis.

6. Suppose there are three objectives, not just two: the total advertising cost, the total number of excess
exposures to men, and the total number of excess exposures to women. Continuing the approach suggested in
the previous problem, how might you proceed? Take it as far as you can, including a sensitivity analysis and a
trade-off curve.

Employee Scheduling Models

8. How much influence can the employee requirements for one, two, or three days have on the weekly
schedule in the employee scheduling example? Explore this in the following questions:
Let Monday’s requirements change from 17 to 25 in increments of 1. Use SolverTable to see how the total
number of employees changes.

Suppose the Monday and Tuesday requirements can each, independently of one another, increase from 1 to 8
in increments of 1. Use a two-way SolverTable to see how the total number of employees changes.

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Suppose the Monday, Tuesday, and Wednesday requirements each increase by the same amount, where this
increase can be from 1 to 8 in increments of 1. Use a one-way SolverTable to investigate how the total number
of employees changes.

10. In the employee scheduling example, suppose the employees want more flexibility in their schedules. They
want to be allowed to work five consecutive days followed by two days off or to work three consecutive days
followed by a day off, followed by two consecutive days followed by another day off. Modify the original model
(with integer constraints) to allow this flexibility. Might this be a good deal for management as well as labor?
Explain.

12. In the employee scheduling example, suppose that the company can require the employees to work one
day of overtime each week on the day immediately following this five-day shift. For example, an employee
whose regular shift is Monday to Friday can also be required to work on Saturday. Each employee is paid $100
per day for each of the first five days worked during a week and $124 for the overtime day (if any). Determine
how the company can minimize the cost of meeting its weekly work requirements.
The new total cost of meeting the weekly requirements is 10,740.

Aggregate Planning Models

14. SureStep is currently getting 160 regular-time hours from each worker per month. This is actually
calculated from 8 hours per day times 20 days per month. For this, they are paid $9.375 per hour . Suppose
workers can change their contract so that they only have to work 7.5 hours per day regular-time—everything
above this becomes overtime—and their regular-time wage rate increases to $10 per hour. They will still work
20 days per month. Will this change the optimal no-backlogging solution?
The optimal solution is considerably higher than the original one.

16. Suppose SureStep could begin a machinery upgrade and training program to increase its worker
productivity. This program would result in the following values of labor hours per pair of shoes over the next
four months: 4, 3.9, 3.8, and 3.8. How much would this new program be worth to SureStep, at least for this
four-month planning horizon with no backlogging? How might you evaluate the program’s worth beyond the
next four months?
The optimal cost arrived at this model is 5,784 lesser than the model presented before. Hence,
Company S will be willing to pay this cost for the additional productivity gains.

18. In the SureStep no-backlogging problem, change the demands so that they become 6000, 8000, 5000,
3000. Also, change the problem slightly so that newly hired workers take six hours to produce a pair of shoes
during their first month of employment. After that, they take only four hours per pair of shoes. Modify the model
appropriately, and use Solver to find the optimal solution.

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Blending Models
20. Use SolverTable in Chandler’s blending model to see whether, by increasing the selling price of gasoline,
you can get an optimal solution that produces only gasoline, no heating oil. Then use SolverTable again to see
whether, by increasing the selling price of heating oil, you can get an optimal solution that produces only
heating oil, no gasoline. Do these solutions sell any leftover crude oils?
The selling price of heating oil must be greater than $70 so that gasoline alone is produced. There is no
leftover crude oil for the prices.

22. How sensitive is the optimal solution (barrels of each input and output sold and total revenue) to the
required quality levels? Answer this by running a two-way SolverTable with these five outputs. You can choose
the values of the two quality levels to vary.
As the quality of the required gasoline increases, the quantity of gasoline sold tends to decrease. The
quantity of heating oil sold also decreases and this leftover crude oil 1 will remain at 0. The leftover of crude oil
2 tends to increase and the revenue will decrease.

As the quality of the required heating oil increases, the quantity of gasoline sold remains almost
constant. The quantity of heating oil sold also decreases and the leftover crude oil 1 will remain at 0. The
leftover of crude oil 2 moves from 0 to some positive level. The revenue tends to decrease in this situation.

24. In the current blending model, a barrel of any input results in a barrel of output. However, in a real blending
problem, there can be losses. Suppose a barrel of input results in only a fraction of a barrel of output.
Specifically, each barrel of either crude oil used for gasoline results in only 0.95 barrel of gasoline, and each
barrel of either crude used for heating oil results in only 0.97 barrel of heating oil. Modify the model to
incorporate these losses, and rerun Solver.
The optimal revenue is lower than before.

25. We warned you about clearing denominators in the quality constraints. This problem illustrates what can
happen if you don’t do so.

a. Implement the quality constraints as indicated in Inequality (4.3) of the text. Then run Solver with the
Simplex LP method. What happens? What if you use the GRG Nonlinear method instead?
The modeling change in this situation is that the constraints in the yellow cells must be instead of those
present in the orange-colored cells. This problem has now changed into non-linear. When the RPG
nonlinear method is utilized, the solver will usually get the correct answer. The solver might also report
an error depending on the starting values in the red colored cells. For instance, it will throw an error if
there are all “0” as it is dividing by “0”.

b. Repeat part a, but increase the selling price of heating oil to $120 per barrel. What happens now? Does it
matter whether you use the Simplex LP method, as opposed to the GRG Nonlinear method? Why?
The optimal solution in this scenario now requires no gasoline. This means that a division process by
“0” in the cell E19. Solver indicates the presence of this error but eventually delivers the optimal
solution.

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