DECISION SCIENCES II

Final Examination
Monday, December 5, 2016

Time: 3.0 Hours

Total No. of Pages: 20 Name _________________________

Total No. of Questions: 5 Roll No. _______________________

Total marks: 80 Section: _______________________

Instructions

1. This is a Closed Book Exam. You are not allowed to carry anything other than stationary
and calculator.
2. Answer all questions only in the space provided following the question.
3. Define all the decision variables precisely and label all the constraints clearly.
4. Show all work and give adequate explanations to get full credit.
5. You may use the backside of the last page for rough work only if needed. Do NOT attach any
rough work/sheets.
6. Encircle or underline your final answer for each part.
7. Any answers in pencil cannot be considered for re-grading.
8. No clarifications will be made during the exam.
Question 1 (10 points)

Consider a two product company (product 1 and 2) that makes a net profit of Rs.40 and Rs.25
on each of the products. Each product has to go through two processes. Process 1 has a total
capacity of 12 hours and process 2 has 20 hours. Product 1 requires 2 hours on process 1 and
7 hours on process 2. Product 2 requires 4 hours on process 1 and 3 hours on process 2. They
also have a requirement for making a total of at least 3 units.

The problem is given below.

Max 40x1+25x2
S.t.
2x1+4x2 <= 12
7x1+3x2 <= 20
x1+x2 >= 3
x1, x2 >= 0.

(a) Solve the problem using a graphical method and find the optimal solution and the
value of the objective function. (3 marks)
7x 1
+
3x 2
=2
0

C
2x
x1

B 1 +4
+

x2
x2

=1
=

2
3

The triangular region is ABC the feasible region. Coordinates of the corner points are as follows:

Point A is the intersection of the lines x1 + x2 = 3 and 7x1 + 3x2 = 20. Substitute x1 = (3 – x2) to get 21
– 7x2 + 3x2 = 20 or x2 = ¼ which gives x1 = 11/4. The objective function value is 40 x1 + 25 x2, which
is 110 + 25/4 = 116 ¼

Point B is the intersection of the lines 2x1 + 4x2 = 12 and 7x1 + 3x2 = 20. Substitute x1 = (6 – 2x2) to
get 7(6 – 2x2) + 3x2 = 20 or x2 = 22/11 = 2 which gives x1 = 2. The objective value is 40 x1 + 25 x2,
which is 80 + 50 = 130

Point C has coordinates x1 = 0 and x2 = 3. The objective value is 40 x1 + 25 x2 = 75.

So the optimum value of Z = 130 is achieved at B (X1 = 2, X2 = 2).

 (b) If the minimum requirement of production is increased to 4 units, how will the value
of the objective function change? (1 mark)

The optimum currently is achieved at (X1 = 2, X2 = 2). Looking at the graph, if the minimum
production goes to 4 units, there is only one point, viz (X1 = 2, X2 = 2) in the feasible region.
This becomes the optimum of the new problem.
The optimum will remain unchanged at 130.

(c) If the profit from product 2 increases to 75 (from the current value of 25), will the
optimal values of the variables change? Give reasons (2 marks)

As long as the slope of the objective function lies between that of lines 2x1 + 4x2 = 12 (which
has slope = -1/2) and 7x1 + 3x2 = 20 (which has slope = -7/3), the coordinates of the optimum
will remain as (X1 = 2, X2 = 2). In other words, the location of the optimum will not change
when the slope of the objective function isoquant is between -7/3 and -1/2.

When the profit from product 2 increases by 50, the new objective function becomes 40 x1 +
75 x2. The slope of this function is -40/75, which is less than -1/2 = -40/80. Also, this slope is
above -7/3. So the optimal value of the variables will not change.

(d) Should the company spend money to increase the capacity of process 2 if it costs Rs.4
per hour of increase? Justify your answer. (2 marks)

Must find the shadow price of the first constraint (on Process 2) from the dual formulation.

Min 12 y1 + 20 y2 – 3 y3

Subject to

2 y1 + 7 y2 – y3 >= 40

4 y1 + 3 y2 – y3 >= 25

All yi >= 0

Alternately: 2 y1 + 7 y2 + y3 >= 40

4 y1 + 3 y2 + y3 >= 25

y1, y2 >= 0 and y3 <= 0.

In the primal at the optimum, the variable values are X1 = 2 and X2 = 2. By complementary
slackness, this means the first two constraints are binding, whereas the third constraint, namely
x1+x2 >= 3 is not binding. This means y3 = 0.

Because X1 = 2 and X2 = 2 are the primal optimum, the two constraints are equalities. So we obtain

2 y1 + 7 y2 = 40

4 y1 + 3 y2 = 25

2 Eq 1 – Eq 2 gives us 11 y2 = 55 or y2 = 5. This in turn gives y1 = (40 – 7 y2)/2 = 5/2

The shadow price for the process 2 is 5, i.e. the objective (profit) goes up by INR 5 for every extra
hour of Process 2 available. This is more than the proposed INR 4 per hour. So the company must
spend the money to increase capacity of Process 1.

(e) Would you advise them to produce a new product that has a net profit of Rs.50 per
unit and uses 6 hours on each of the two processes? (2 marks)

From our previous calculations, the shadow price for Process 1 is INR 2.5 per hour and for
Process 2 is INR 5 per hour.

Because the proposed product consumes 6 hours of each of the two processes, the opportunity
cost of manufacturing the new product would be 6 y1 + 6 y2 = 15 + 30 = INR 45.

Alternately, the reduced cost for the new product is 50 -6 y1 - 6 y2 = 50 -15 - 30 = 5

Because the profit exceeds the cost, the company could proceed to make the product.
Question 2 (20 Points)

West Coast Oil Company blends petrol from three components: Domestic Blend, Foreign
Blend, and an octane Additive used only in Premium petrol. Foreign Blend is itself a blending
of two sources. Foreign Blend is transported monthly to West Coast Oil in a single 80,000,000
gallon storage compartment of a large tanker. Because the oil purchased from the two sources
loses its separate identities when “pooled” in a storage compartment of a tanker, the model is
called a pooling model. Octane numbers, cost per gallon, and the availability information for
each component are given in Table 1.
The problem West Coast Oil faces is to decide how many gallons of Regular Unleaded,
Midgrade Unleaded, and Premium Unleaded petrol to blend each month, given that it must
honor minimum supply contracts of 100,000 gallons of each type of petrol. Each type of petrol
is subject to a minimum octane requirement. The octane number of a petrol blend is the
weighted average of the octane numbers of its components where the weights are the fraction
of each component in the blend. Data on the minimum octane numbers and (wholesale) selling
prices are given in Table 2. What decisions must West Coast Oil take?

TABLE 1. Component Characteristics

COMPONENT OCTANE COST / AVAILABILITY

NO. GALLON (000s GAL/MONTH)

Domestic Blend 88 $ 0.65 10,000

Foreign Blend

Source 1 93 $ 0.80 *

Source 2 97 $ 0.90 *

Premium 900 $30 50

Additive

TABLE 2. Product Characteristics

MINIMUM OCTANE SALES PRICE PER
NO. GALLON

Regular Unleaded 87 $2.18

Midgrade Unleaded 89 $2.25

Premium Unleaded 94 $2.40

 (a) Define the appropriate set of variables needed to develop an optimization model to
resolve West Coast Oil’s decision problem. (4 points)

Let Xij = quantity produced in `000s of gallons from blend i of product j where i = domestic
blend (D), foreign blend 1 (F1), foreign blend 2 (F2), premium additive (P), and j = R, M,
P

Note that this translates into XDR, XF1R, XF2R; XDM, XF1M, XF2M; XDP, XF1P, XF2P,
XPP

as premium additive is used only for the Premium Unleaded product.

(b) Formulate the problem as a linear program to meet the following goals in order of
priority:
i. Revenue of at least $600,000
ii. Keep the deviation below the octane requirements to at most 1
iii. Meet the minimum supply for each product
State all the constraints and explain them. (12 points)

Priority i.

The revenue earned is the price per gallon multiplied by the gallons produced. This is given
below where the rhs is 600 since the variables are measured in `000s of gallons.

2.18*(XDR+XF1R+XF2R)+ 2.25*(XDM+XF1M+XF2M)+2.4*(XDP+XF1P+XF2P+XPP)
+d1 >= 600

[or alternately,

2.18*(XDR+XF1R+XF2R)+ 2.25*(XDM+XF1M+XF2M)+2.4*(XDP+XF1P+XF2P+XPP)
+d1- - d1+ = 600 ]

Priority ii.

88 XDR +93XF1R +97XF2R >= 87

(XDR+XF1R+XF2R)
The above constraint’s lhs is the weighted average Octane number which must exceed the
minimum for Regular. Linearizing this and adding a deviation variable we get:

88 XDR +93XF1R +97XF2R – 87(XDR+XF1R+XF2R) +d2 >= 0

The goal is to keep the deviation d2 to at most 1:

And, d2 – d3 <= 1
Alternately,

88 XDR +93XF1R +97XF2R – 87(XDR+XF1R+XF2R) +d2- - d2+ = 0

And, d2- - d2+ – (d3- - d3+ ) = 1

Similarly for the other two products,

88 XDM +93XF1M +97XF2M – 89(XDM+XF1M+XF2M) +d4 >= 0

And, d4 – d5 <= 1;

88 XDP +93XF1P +97XF2P+900XPP – 94(XDM+XF1M+XF2M=XPP) +d6 >= 0

And, d6 – d7 <= 1;

Priority iii.

XDR+XF1R+XF2R +d8 >= 100

XDM+XF1M+XF2M +d9 >= 100

XDP+XF1P+XF2P+XPP +d10 >= 100

Alternately,
XDR+XF1R+XF2R + d8- - d8+ = 100

XDM+XF1M+XF2M + d9- - d9+ = 100

XDP+XF1P+XF2P+XPP + d10- - d10+ = 100

Other constraints:

Foreign Blend storage:

XF1R+XF2R+XF1M+XF2M+XF1P+XF2P <= 8000

Objective Function:

Min P1*d1+P2*(d3+d5+d7)+P3*(d8+d9+d10)
or Min P1*d1- +P2*(d3-+ d5-+ d7-)+P3*(d8-+d9-+d10-)

Where P1 >> P2 >> P3.

Or we solve first for Priority 1 goal with Objective function Min d1, then solve for Priority 2
goal with objective function Min d3 d3+d5+d7 and finally for Priority 3 goals with objective
function Min d8+d9+d10.
 (c) If all the goal constraints are met without any deviation, what should the company’s
objective function be? Write down the objective function and explain it (4 points)

If all goals are met, then the company should maximize the net profit and use the objective
function below:

Max 2.18(XDR+XF1R+XF2R)+ 2.25(XDM+XF1M+XF2M)+2.4(XDP+XF1P+XF2P+XPP)

– 0.65(XDR+XDM+XDP)-0.8(XF1R+ XF1M+XF1P)-0.9(XF2R+ XF2M+XF2P)-30XPP

Where the positive terms give the total revenue and the negative terms are the costs of the
components used in the final products.
The rest of the constraints remain the same except that the deviation variables are dropped.

Question 3 (20 points)

A cargo plane has three compartments for storing cargo: front, centre, and back. These
compartments have capacity limits on both weight and space, as summarized below:

Compartment Weight Capacity Space Capacity

(tons) (cu ft.)
Front 8 5,000
Center 12 7,000
Back 7 3,000

Furthermore, in order to maintain the plane’s balance, the proportion of the weight of the cargo
in each compartment to the weight capacity of that compartment must be equal for the three
compartments.

The following four cargoes have been offered for shipment on an upcoming flight as space is
available:

Cargo Weight Volume Profit

(tons) (cu ft./ton) ($/ton)
1 14 500 100
2 11 700 130
3 18 600 115
4 9 400 90

Any portion of each of these cargoes can be accepted. For example half of Cargo 1 could be
accepted and its weight and volume are proportionately halved. The objective is to determine
how much, if any, of each cargo should be accepted and how should the accepted cargoes be
distributed amongst the compartments in order to maximize the total profit for the flight. An
appropriate mathematical programming formulation that can help in obtaining the optimal
decision is desired.
A. Assuming that the accepted portion of each cargo can be loaded in parts in one or more of the
three compartments:

(a) Define the decision variables needed for finding the optimal solution to the above
problem. (2 points)

Let Xij >= 0 be the number of tons of Cargo i going into Compartment j
There are four cargo types 1…4 and three compartments 1,2,3.

where j = 1,2,3 refers to Front, Centre ad Back respectively

(b) State the constraints and label them clearly. (8 points)

Weight constraints on the three compartments prohibit overloading:

X11 + X21 + X31 + X41 <= 8

X12 + X22 + X32 + X42 <= 12
X13 + X23 + X33 + X43 <= 7
Volume constraints on the three compartments prohibit overloading:

500 X11 + 700 X21 + 600 X31 + 400 X41 <= 5,000
500 X12 + 700 X22 + 600 X32 + 400 X42 <= 7,000
500 X13 + 700 X23 + 600 X33 + 400 X43 <= 3,000

We have the constraint, “the proportion of the weight of the cargo in each compartment to the
weight capacity of that compartment must be equal for the three compartments.”

E.g. Weight of the cargo in Compartment 1 = X11 + X21 + X31 + X41

Weight capacity of Compartment 1 = 8 tons

We state the constraint as

(X11 + X21 + X31 + X41)/8 = (X12 + X22 + X32 + X42)/12 = (X13 + X23 + X33 + X43)/7

This can be re-written as two linear constraints:

(X11 + X21 + X31 + X41)/8 - (X12 + X22 + X32 + X42)/12 = 0

And
(X12 + X22 + X32 + X42)/12 - (X13 + X23 + X33 + X43)/7 = 0.

(c) Specify the objective function. (2 points)

The objective is to maximize profit = 100 (X11 + X12 + X13) + 130 (X21 + X22 + X23) +
115 (X31 + X32 + X33) + 90 (X41 + X42 + X43)
B. Now assuming that the accepted portion of each cargo needs to be loaded in only one of the
three compartments:

(d) Define the decision variables needed for finding the optimal solution to the above
problem. (2 points)

Let Yij = 1 if Cargo i goes into Compartment j, i= 1…4 and j= 1,2,3

= 0 otherwise

Thus Yij is a binary variable

(e) State the constraints and label them clearly. (6 points)

X11 – 8Y11 <= 0; X21 – 8Y21 <= 0; X31 – 8Y31 <= 0; X41 – 8Y41 <= 0;

The above four constraints ensure that if cargo i is loaded in the front compartment, then
the appropriate binary variable becomes 1.

Similarly, we have;

X12 – 8Y12 <= 0; X22 – 8Y22 <= 0; X32 – 8Y32 <= 0; X42 – 8Y42 <= 0;

X13 – 8Y13 <= 0; X23 – 8Y23 <= 0; X33 – 8Y33 <= 0; X43 – 8Y43 <= 0;

For the centre and back compartments.

Finally we need to ensure that a particular cargo is loaded in only one compartment:

Y11+Y12+Y13 <= 1

Y21+Y22+Y23 <= 1

Y31+Y32+Y33 <= 1

Y41+Y42+Y43 <= 1

The combined effect is to ensure that a particular cargo is in one compartment.

Otherwise for instance if cargo1 is in the front and centre compartments, then X11>0
and X12> 0. Hence Y11 =1 and Y12 = 1. But this is not possible since
Y11+Y12+Y13 <= 1
Question 4 (20 marks)

Appukuttan Velayuthan Menon (AVM) is the co-founder and CEO of Appukuttan Munthiri
Thottam (AMT), a vineyard established in Thekkady, Kerala. AMT cultivates 3 types of grapes
namely 1. Malbec, 2. Cabernet and 3. Riesling. The monthly production of Malbec, Cabernet
and Riesling at AMT is 350 Kg, 300 Kg and 200 Kg respectively. Using these grapes,
Appukuttan makes 3 brands of wines namely: 1. Chardonnay, 2. Blanc and 3. Riesling W. The
wines are made by mixing the three different types of grapes and two additives at various
proportions. The amount of grapes and additives used to produce 1 litre of different brands of
wines are shown in Table 1.

Table 1. Quantity of grapes and additives used in 1 litre of wine

Grape Amount in Kg Used Additive used in Kg

Wine Malbec Cabernet Riesling Additive 1 Additive 2
Chardonnay 1.25 0.75 0.15 0.10 0.20
Blanc 0.80 1.80 0.25 0.05 0.15
Riesling W 0.4 0.6 2.0 0.08 0.12
Availability 350 300 200 120 80

The profit earned from wines Chardonnay, Blanc and Riesling W are 400, 950 and 1350 per 1
litre respectively. The following LP formulation is written to maximize the profit for AMT.
Monthly maximum demand for Chardonnay, Blanc and Riesling W is 1000, 750 and 250 litres
respectively.

X1 = Amount (in litres) of Chardonnay produced

X2 = Amount (in litres) of Blanc produced

X3 = Amount (in litres) of Riesling W produced

The objective is:

Max 400 X1 + 950 X2 + 1350 X3

S.t.

1.25 X1 + 0.80 X2 + 0.40 X3 <= 350

0.75 X1 + 1.80 X2 + 0.60 X3 <= 300
0.15 X1 + 0.25 X2 + 2.00 X3 <= 200
0.10 X1 + 0.05 X2 + 0.08 X3 <= 120
0.20 X1 + 0.15 X2 + 0.12 X3 <= 80
X1 <= 1000
X2 <= 750
X3 <= 250
The Excel Solver output for the above formulation is given in Table 2.

Table 2. Microsoft Excel 14.0 Sensitivity Report

Variable Cells

Final Reduced Objective Allowable Allowable

Cell Name Value Cost Coefficien Increase Decrease

t

$A$2 X1 0 400 1E+30

$B$2 X2 139.1304 0 950 3100 50.26

$C$2 X3 82.6087 0 1350 6250 859.09

Constraints

Final Shadow Constraint Allowable Allowable

Cell Name Value Price R.H. Side Increase Decrease

$A$5 Constraint 144.34 350 1E+30 205.65

s

$A$6 Constraint 300 300 473 240

s

$A$7 Constraint 200 200 320.83 158.33

s

$A$8 Constraint 13.56 120 1E+30 106.43

s

$A$9 Constraint 30.78 80 1E+30 49.21

s

$A$10 Constraint 0 1000 1E+30

s

$A$11 Constraint 139.13 750 1E+30 610.86

s
 $A$12 Constraint 82.60 250 1E+30 167.39
s

Question 4.1 (2 points)

Appukuttan can procure Malbec from Bangalore for INR 80 rupees per Kg. Should AVM buy
Malbec, justify your answer.

The constraint for Malbec grapes is: 1.25 X1 + 0.80 X2 + 0.40 X3 <= 350

The final value for the LHS at the optimum (X1 = 0, X2 = 139.13 and X3 = 82.60) is 144.34 < 350.
Consequently, the constraint is non-binding, so the corresponding shadow price is 0. So there is no
need for AVM to buy Malbec grapes.

Question 4.2 (2 points)

A loyal customer of AVM has asked for 20 litres of Chardonnay wine, what will be the impact
on profit for AMT, if AVM decides to supply Chardonnay wine. AVM would like to ensure
that supplying Chardonnay will not impact the profitability of AMT, what will be your
suggestion.

Though the optimal value of Chardonnay is 0, we cannot be sure that its reduced cost is also
zero. We need to check. For this we need to find the shadow prices.

From the constraints we see that for constraints 1,4,5,6,7,8 there is slack. Hence

y1 = y4 = y5 = y6 = y7 = y8 = 0.

Since x2>0 and x3 >0, the corresponding dual constraints are bending. Hence:

1.8y2+0.25y3 = 950

0.6y2+2y3 = 1350.

Solving, we get y2 = 452.8986 and y3 = 539.1304.

So the reduced cost is

400 – 0.75*452.8986 – 0.15*539.1304 = -20.54 < 0

This means that the profit will go down. So AVM should not supply the Chardonnay.

Question 4.3 (3 points)

The supplier of grapes from Bangalore is ready to supply 500 Kg Cabernet at the same price
as the production cost of AMT resulting in no difference in profit. Should AVM buy 500 Kg
from the Bangalore supplier? Justify your answer.

The shadow price for Cabernet (y2) is positive. The maximum allowable increase is 473. So if
they buy this amount the profit will go up by

473*452.8986 = 214221.

An increase beyond 473 kg will change the shadow price and it is not known whether the profit
will further increase.

Question 4.4 (2 points)

The grape Malbec can be directly sold in the Market at INR 70 per Kg instead of using them
in wine production. The monthly demand for Malbec grapes in Thekkady is 300Kgs. What
will be your suggestion for Appukuttan?

If they have procured the maximum 350 kg, then they have some left as they consume only
144.34. The remaining 205.66 kg can be sold at Rs.70/kg to get Rs.14396.2.

Otherwise whatever extra Malbec they have lying unused can be sold.

Question 4.5 (2 points)

Due to Riesling crop failure in Napa County, California USA, the demand for Riesling W
increases significantly. AVM decided to increase the profit on Riesling W to INR 2000. What
will be impact of this change to the current optimal solution? What will be the impact on the
profit?

The allowable increase in profit for Riesling W is 6250. So a total profit of 2000 is well within the
increase of 6250 – in fact the increase is only (2000 – 1350) = 650

There will be no change in the current optimal solution (X1 = 0, X2 = 139.13 and X3 = 82.60). The total
increase in profots = 650 x 82.60 = INR 53,690

Question 4.6 (2 points)

Due to oversupply of wines in the market, Appukuttan decides to decrease the profit on Blanc
and Riesling W by INR 35 and INR 200 respectively. What will be impact of this reduction
on the current optimal solution?

We first represent the profit decreases by INR 35 and INR 200 as percentages of the allowable
decreases (INR 50.26 and INR 859.09) for the optimum to remain unchanged.

P1 = 35/50.26 = 69.64% and P2 = 200/859.09 = 23%

Because P1 + P2 < 100%, the optimum will remain unchanged. However, the profit will be reduced by
35 * 139.13 + 200 * 82.60 = 21389.6

Question 4.7 (3 points)

A new wine Merlot can be produced by mixing the various ingredients as shown below. The
profit earned from Merlot is AMT 990 per litre. Do you think AMT should produce this wine?

Malbec Cabernet Riesling Additive 1 Additive 2

0.8 1.75 1.15 0.20 0.20

By earlier calculations, the only shadow prices that are non-zero are Y2 = 452.9 & Y3 = 539.13

The opportunity cost for producing a litre of Merlot is 1.75 * 452.9 + 1.15 * 539.13 = 1412.57

Because it exceeds the profit of INR 990, it is advisable for AMT not to produce it.
Alternately, the reduced cost is 990 - 1.75 * 452.9 - 1.15 * 539.13 = -422.572 < 0. Hence they should
not produce it.

Question 4.8 (2 points)

A neighbour of AVM is ready to sell Riesling to AMT at 200 per Kg at the same production
cost as that of AMT. What will be impact of this additional Riesling on the profitability of
AMT?

The allowable increase in Riesling W grapes while the optimum (X1 = 0, X2 = 139.13 and X3 = 82.60)
remains unchanged is 320.83. Given that the shadow price of Riesling W grapes is Y3 = 539.13, it is
advisable that Appukuttan source 320.83 kg of Riesling W grapes from his neighbour @ INR 200 a kg
to get INR 108803.2 extra profit.

Question 4.9 (2 points)

The market values of additives 1 and 2 are 40 per kg and 75 per kg respectively. What will be
your suggestion to AVM for efficient production planning?

AVM only grows the grapes – the two additives must be procured from the market.
The final values of these additives in the optimal solution are 13.56 Kg and 30.78 Kgs respectively.
Because the shadow prices are 0 and the availability of these additives is higher (120 and 80 kilos),
AVM can procure 13.56 Kg of Additive 1 and 30.78 kg of Additive 2 each month.

Question 5 (10 marks)

Murugan Idly shop in Madurai has 3 main breakfast items sold. All three items are made using
2 main ingredients and the mathematical programming formulation is shown below.

Max 2 X1 + 3.5 X2 + 1.8 X3

0.5 X1 + 0.25 X2 + 0.4 X3 <= 10

X1 + 0.5 x2 + 0.8 X3 <= 12

X1, X2 are integers and X3 >= 0

Question 5.1 (1 point)

Write a LP relaxation problem for the mixed Integer Programming model stated above.

The relaxed version is:

Max 2 X1 + 3.5 X2 + 1.8 X3

0.5 X1 + 0.25 X2 + 0.4 X3 <= 10

X1 + 0.5 X2 + 0.8 X3 <= 12

X1, X2 and X3 >= 0

Question 5.2 (9 points)

Use branch and bound algorithm to find the optimal solution to the mixed integer programming
problem. Use LP relaxation solutions provided in Appendix 1

From Problem 1, 2, 3 in the Appendix, we see that:

Problem 1 has a fractional solution with z (the optimal value of he objective function) equalling
42.22.

Problem 2 branches on x1 and adds the constraint x1 <= 17. It gives a fractional solution with
z = 41.95.

Problem 3 branches on x1>= 18 and gives an integer solution of z= 42, x1 = 18, x2=4, x3 = 0.

So Node 3 at problem 3 in the Branch and Bound tree is fathomed. Node 2 at Problem 2 has a
lower value of z. so it is also fathomed.
Since there are no more nodes left, the optimal solution is at Node 3 above.

Appendix 1

Problem 1
Max Z = 2 X1 + 3.5 X2 + 1.8 X3
0.5 X1 + 0.25 X2 + 0.4 X3 <= 10
X1 + 0.5 x2 + 0.8 X3 <= 12
X1, X2 and X3 >= 0
LP relaxation solution
X1 = 17.77, X2 = 4.44 and X3 = 0 and Z = 42.22

Problem 2
Max Z = 2 X1 + 3.5 X2 + 1.8 X3
0.5 X1 + 0.25 X2 + 0.4 X3 <= 10
X1 + 0.5 x2 + 0.8 X3 <= 12
X1 <= 17
X1, X2 and X3 >= 0
LP relaxation solution
X1 = 17.00, X2 = 3.20 and X3 = 1.75 and Z = 41.95

Problem 3
Max Z = 2 X1 + 3.5 X2 + 1.8 X3
0.5 X1 + 0.25 X2 + 0.4 X3 <= 10
X1 + 0.5 x2 + 0.8 X3 <= 12
X1 >= 18
X1, X2 and X3 >= 0
LP relaxation solution
X1 = 18.00, X2 = 4.0 and X3 = 0 and Z = 42
Problem 4
Max Z = 2 X1 + 3.5 X2 + 1.8 X3
0.5 X1 + 0.25 X2 + 0.4 X3 <= 10
X1 + 0.5 x2 + 0.8 X3 <= 12
X2 >= 5
X1, X2 and X3 >= 0
LP relaxation solution
X1 = 17.08, X2 = 5.00 and X3 = 0 and Z = 41.66

Problem 5
Max Z = 2 X1 + 3.5 X2 + 1.8 X3
0.5 X1 + 0.25 X2 + 0.4 X3 <= 10
X1 + 0.5 x2 + 0.8 X3 <= 12
X2 <= 4
X1, X2 and X3 >= 0
LP relaxation solution X1 = 17.5, X2 = 4 and X3 = 0.625 and Z = 42.125

Problem 6
Max Z = 2 X1 + 3.5 X2 + 1.8 X3
0.5 X1 + 0.25 X2 + 0.4 X3 <= 10
X1 + 0.5 x2 + 0.8 X3 <= 12
X2 <= 4
X1 <= 17
X1, X2 and X3 >= 0
LP relaxation solution
X1 = 17.0, X2 = 3.2 and X3 = 1.75 and Z = 41.95

Problem 7
Max Z = 2 X1 + 3.5 X2 + 1.8 X3
0.5 X1 + 0.25 X2 + 0.4 X3 <= 10
X1 + 0.5 x2 + 0.8 X3 <= 12
X2 <= 4
X1 >= 18
X1, X2 and X3 >= 0
LP relaxation solution
X1 = 18.0, X2 = 4 and X3 = 0 and Z = 42