Course Pack OR-BBA 2022-23

COURSE PACK
FOR
INTRODUCTION
TO
OPERATIONS RESEARCH
BBA V SEM
Course Instructors: Dr. Parul Agrawal

Dr. Bhawna Duggal
Dr. Nancy Goel
Dr. Vinod Jangid
Course Leader: Dr. Bhawna Duggal
Bharati Vidyapeeth University

Institute of Management & Research, New Delhi
An ISO 9001:2015 Certified Institute
“A+” Grade Re-Accreditation by NAAC
--------------------------------------------- ----------------------------------------
Forwarded by Approved by Director
Program Coordinator
1|Page For Internal Circulation

BVIMR Snapshot
Established in 1992, Bharati Vidyapeeth (Deemed to be University) Institute of Management and

Research (BVIMR), New Delhi focuses on imbibing the said values across various stakeholders through
adequate creation, inclusion and dissemination of knowledge in management education.
The institute has over the past few years emerged in the lead with a vision of Leadership in professional
education through innovation and excellence. This excellence is sustained by consistent value
enhancement and initiation of value-added academic processes in Institute’s academic systems.
Based on the fabulous architecture and layout on the lines of Nalanda Vishwa Vidyalaya, the institute is a
scenic marvel of lush green landscape with modern interiors. The Institute which is ISO 9001:2015
certified is under the ambit of Bharati Vidyapeeth University (BVU), Pune as approved by Govt. of India
on the recommendation of UGC under Section 3 of UGC Act vide its letter notification No. F. 9 – 16 /
2004 – U3 dated 25th February, 2005.
Strategically located in West Delhi on the main Rohtak Road, BVIMR, New Delhi has splendid layout on
sprawling four acres of plot with 'state-of-art' facilities with all class rooms, Library Labs, Auditorium etc.
that are fully air-conditioned. The Institute that has an adjacent Metro station “Paschim Vihar (East)”,
connects the entire Delhi and NCR.
We nurture our learners to be job providers rather than job seekers. This is resorted to by fostering the
skill and enhancement of knowledge base of our students through various extracurricular, co-curricular
and curricular activities by our faculty, who keep themselves abreast by various research and FDPs and
attending Seminars/Conferences. The Alumni has a key role here by inception of SAARTHI Mentorship
program who update and create professional environment for learners centric academic ambiance and
bridging industry-academia gap.
Our faculty make distinctive contribution not only to students but to Academia through publications,
seminars, conferences apart from quality education. We also believe in enhancing corporate level
interaction including industrial projects, undertaken by our students under continuous guidance of our
faculty. These form the core of our efforts which has resulted in being one of the premier institutes of
management.
At BVIMR, we are imparting quality education in management at Doctorate, Post Graduate and Under
Graduate levels.
*********

Brief Profiles of faculty members:
Dr. Parul Agrawal
Dr. Parul Agrawal is currently working as Associate Professor with Bharati Vidyapeeth University
Institute of Management and Research (BVIMR) and has been working with this esteem institution for the
past 13 years.
He has done his Ph.D in management from Bharati Vidyapeeth (Deemed to be University). He has 23
years of experience of teaching subjects like Operations Research, Financial Management, Economics,
Management Accounting, and Cost Accounting. He has organizing various National & International
conferences, Case Study writing & presentation competitions, AIMS round table conference, Model
United Nations Academy, SDPs and FDPs during his service tenure including one AICTE sponsored FDP
of two weeks. He is also editor of one book on Case Studies in Management. He has also written
numerous papers in the journal of repute and presented papers at various national & International
platforms.
Dr. Bhawna Dhawan
She is currently working as Assistant Professor at Bharati Vidyapeeth University Institute of Management
and Research (BVIMR) and has been working with this esteem institute for the past 14 years. She is Ph.D.
in management from Bharati Vidyapeeth (Deemed to be University) and a UGC NET qualified faculty.
She has also earned a degree in M.Phil from Vinayaka Mission University, MBA & BCAM from Guru
Gobind Singh Indraprastha University. She has 16 years of experience of teaching subjects like Operations
Research, Financial Management, Economics, Management Accounting, Cost Accounting. She has
organized various FDPs during her service tenure including two AICTE sponsored FDPs of two weeks.
She has also organized NTPC sponsored National Seminar on “Women Entrepreneurship, Empowerment
& Development'' in 2014, which was inaugurated by Hon’ble late Smt. Sheila Dixit (the then chief
minister of Delhi) and has organized international webinars and conferences. She is also editor of two
books, namely, Women Empowerment & Social Development and Case Studies on Management. She has
also written papers in the journal of repute on financial inclusion which focuses on how to make people
self-sufficient rather than relying on unorganized markets.

Dr. Nancy Goel
She is working as assistant professor with Bharati Vidyapeeth institute of management and research. She
has completed her doctorate degree from BVIMR, New Delhi. She has qualified UGC NET and also done
Masters in business administration, bachelors in business administration, graduate diploma in international
business. She has also qualified UGC NET.
She has industry experience of two years as Business Development Executive in import export department
and more than eight years of teaching experience. She has completed one UGC funded research project in
collaboration with BVIMR and completed one minor university project as well. She has published two
books. She has also published many research papers in national and international journals. She has
publications in Scopus indexed journals like springer and Elsevier also.
She has presented papers in many international conferences. She has been awarded as a “promising
scholar”. She takes sessions with PhD scholars on Literature Review, Data Analysis using SPSS, turn it in
software for plagiarism check.
Dr. Vinod Kumar Jangid

Dr. Vinod Kumar Jangid (MSc, MBA,NET,PhD) Dr. Vinod Kumar Jangid is a Professor of Operations
Management. He had done MBA(Marketing) from IMS , Indore, and M.Sc(Maths) from Delhi
University.He had done his Ph.D from Dr. B. R. Ambedkar University, Agra in Management. He is also
UGC-NET qualified in Management subject. His area of Interest is: Quantitative Techniques, Production
Operation Management, Marketing Management, Managerial Economics. He has more than 21 years of
work experience in academics field. He is working as a visiting faculty in various reputed business schools
like:- AMITY, JIMS, IMT, IGNOU, AIMA, Asia Pacific Institute of Management & Many others. He
also conduct MDP for PSU and IAS officers of some period of time.

Index
Unit Topic Page No.
Course Outline
 Course Overview
 Learning Outcomes
 List of Modules
7-16
 Evaluation Criteria
 Books Recommendation
 Session Plan
 Mapping lecture with course learning outcomes
 Contact Details
Introduction to Operations Research

 Definition of Operations Research
 Origin and Development of Operations Research
1 17-20
 Application/ Scope of Operations Research
 Advantages of Operations Research
 Limitations of Operations Research
Linear Programming Problem (LPP)

 Definition
 Components of LPP
 Assumptions underlying LPP
 Graphical Solution to LPP
 Advantages of LPP
2 21 – 30
 Limitations of LPP
 Practice Questions
Formulation
Graphical Method
 Additional Notes (if any)

Transportation Problems
 Inputs
 Objective
 Transportation Methods
 North-West Corner Rule
 Least Cost Method
3 31 – 40
 Vogel’s Approximation Method
 Test for optimality
 Special Cases in Transportation Problems
 Flow Charts
Assignment Problems
 Hungarian Assignment Method
 Variations of the Assignment Problem
 Multiple Optimal Solutions:
 Maximization Case in Assignment Problem:
4. 41 – 48
 Unbalanced Assignment Problem
 Prohibition in Assignment Problem
 Flow Chart
Network Analysis
 Rules of Network Construction
 Floats 49 - 58
5.
 PERT
 Difference between PERT & CPM
Z Table
Random No. Table
6. Previous year Question Papers (Internal) 59-83
Previous year Question Papers (University)
Sample MCQs

BHARATI VIDYAPEETH DEEMED UNIVERSITY
INSTITUTE OF MANAGEMENT AND RESEARCH
Course Outline
BBA-Sem V
ACADEMIC YEAR 2022-23
1. Course Code: 505 Credits: 4

2. Course Title: Introduction to Operations Research
3. Course Overview:
Operation research (OR) is the discipline of applying advanced analytical methods to help make better
decisions. It uses mathematical modeling, analysis, and optimization in a holistic approach to improving our
knowledge of systems and designing useful, efficient systems. Its applications range from engineering to
management and from industry to the public sector.
Operations Research (OR) is the application of mathematical techniques and analysis to problem solving in
business and industry, in particular to carrying out more efficiently tasks such as scheduling, or optimizing
the provision of services. OR is an interdisciplinary topic drawing from mathematical modeling,
optimization theory, game theory, decision analysis, statistics, and simulation to help make decisions in
complex situations. This course in OR concentrates on mathematical modeling and optimization: for
example maximizing production capacity, or minimizing risk. The course covers a variety of mathematical
techniques for linear optimization, and the theory behind them. Examples will be presented from important
application areas, such as the emergency services, telecommunications, transportation, and manufacturing.
This module aims to introduce students to use quantitative methods and techniques for effective decisions–
making; model formulation and applications that are used in solving business decision problems.
1. To provide students with basic skills and knowledge of operations research and its application.
2. To make students Understand how to translate a real-world problem, given in words, into a
mathematical formulation.
3. To introduce the students how to use variables for formulating complex mathematical models in
management science.
4. To introduce the students to the use of basic methodology for the solution of LPP, Transportation,
Assignment, PERT/CPM, Simulation etc. and critically analyzing and interpreting results.
5. Students must be able to apply the techniques used in operations research to solve real life problems.
The students are expected to review the course readings and the indicated portion of the prescribed
text for class discussions prior to attending each session.

4. Learning Outcomes:
After undergoing this course, the student will be able to:
Understand the practical importance and applications of various operations research techniques.
Specific knowledge:
(a) Formulate a Linear Program (LP) or translate into standard form, and use the Graphical Method to
solve.
(c) Formulation and solution of network problems using PERT and CPM.
(d) How to solve transportation & Assignment Problems for time cost & distance optimization.
(e) Better understand the topic of Simulation and its use in practical problems.
5. List of Topics/ Modules:
Topic/ Module Contents/ Concepts
 Definition, Meaning & Significance

 History
Module I: Introduction to Operations  Scope and Limitations
Research  Advantages and Limitation of Operations
Research
 Definition and Components of LPP
 Formulation of LPP model,
Module II: Linear Programming
 Solution
Problem
 Max/Min Problems, Graphical Method
 Application and Limitation
 Formulation
 Initial Feasible Solution using North West Corner
Module III: Transportation Problems
Rule, Row Minima Method, Column Minima
Method, Matrix Minimum Method, VAM
 Optimality Check by MODI method
 Meaning, Definition and application of assignment
Module IV: Assignment Problem problem.
 Hungarian Method
 Assignment Problem for Max/ Min Cases.
 PERT and CPM Techniques
 Introduction to Networks
 Key terms in Network Analysis, Network Models –
PERT/ CPM
Module V: Network Analysis  Network Components and Precedence Relationships
 CPM, PERT
 Determination of PERT times
 Determining critical path
 Floats and Slacks

6. Evaluation Criteria:
Component Description Weightage for

100 marks
It will be based on conceptual questions and situation specific

1.End Term application oriented questions. End term exam will cover both pre
60 %
Exams mid-term and post mid-term course coverage. Course readings are
an integral component of learning in this course.
There will be two Internal exams of 10 % weight age each. They

will be based on conceptual questions and situation specific
2.Mid Term application oriented questions. Course readings are an integral
20 %
Exams component of learning in this course. At least one of the questions
will be based on these readings which will not be specified to the
students.
Students will be awarded marks for active and constructive

participation in class. Students are also required to submit reflective
3.Class notes individually at the end of each class. (Reflective notes are
Participation & collection of notes, observation, thoughts and learning that the 10%
Reflective Notes
students have experienced after attending the class. The reflective
notes will include only the key learning and key takeaways which
the students got from the class.)
Students will be Evaluated 3 times through any of the CES

activities which includes Class test, Case Studies, Quiz on Moodle,
4. Continuous
Presentations etc. Their knowledge may be tested through class
Evaluation System 10 %
(CES) tests at the end of each module. They may also be asked to give
presentations on the topics allotted to them and at the end of the
complete syllabus they will required to appear in the quiz on
moodle.

7. Recommended/ Reference Text Books and Resources:
Text Books 1.Vohra, N. D, Quantitative Techniques in Management, 4th Ed, Tata McGraw Hill,
2010.
1. Gupta, P. K., & Hira, D. (2010). Operations Research. S. Chand & Company Ltd.
Course Reading 2. Sharma, J. K. (2013). Operations Research (5th ed.). Mcmillan Publishers India
Ltd.
3. Taha : An Introduction to Operations Research, PHI
You tube Links

https://youtu.be/1CnFjNOewEU
https://youtu.be/ILWbaWrjgU4
https://youtu.be/-aIV14ZLqOM
10 | P a g e For Internal Circulation

8. Session Plan:
Reading Due
by the students
Schedule Topic to be discussed Learning Outcome
before coming
to the class
Quantitative Techniques in Management
Module I - Overview of Operation Research
by N.D.Vohra, 4th Edition
History of OR; Meaning & Significance of

Chapter-1
OR How to use different
1 Page No. 3 -
Scope & Limitations of OR applications of OR to
12
Applications of OR in Business solve real life problems
Module II - Linear Programming
Theoretical concepts of Linear To develop the skill and

programming problems ability to translate a
2 Chapter-2 given real – life situation
Formulation of Linear programming Page No. 19 - into a linear
problems 25 programming format.
Formulation of Linear programming Page No. 19 -
3
problems 25
Enhancement of
4 Discussion/Evaluation on Assignment given - analytical skills
Solution by graphical methods-

5 Page No. 25-29
Maximization Problem
Solution by graphical methods- How to minimize cost &
6 Page No. 29-32
Minimization Problem maximize profit/output.
Solution by graphical methods-Mix Example 2.11-
7
Problem 2.21
Special Cases in LPP (Multiple &
8
Unbounded)
Enhancement of
Page No. 32-37
Special Cases in LPP (Multiple & analytical skills
9
Unbounded)
Discussion on Research Paper- LINEAR

https://www.ijeast.com/papers/223-
10 PROGRAMMING : A BOON FOR
226,Tesma512,IJEAST.pdf
FARMERS
11 Doubts handling -

Module III - Transportation Problems
Introduction about
transportation problem Chapter-5 How OR model is used to
12
Page No. 204-209 optimize the transportation cost
Solution by North West Corner
Method
Solution by Least Cost Method Page No. 210-211
Enhancement of Problem solving
13
Solution by Row Minima, and analytical skills
Notes given
column Minima Method
Solution by Vogel's
14 Page No. 211-214 How OR model is used to
Approximation Method
optimize the transportation cost
Solution by Vogel's
15 Page No. 211-214
Approximation Method
Optimum Solution by MODI
16 Page No. 220-224 Enhancement of Problem solving
method
and analytical skills
Optimum Solution by Modi
17 Page No. 220-224
method
Special Cases – Unbalanced,
18 Page No. 224-235 Enhancement of analytical skills
Maximization, Restricted
Special Cases-Degeneracy in
19 P. No. 224-235
Discussion on Research
https://www.researchgate.net/publication/
20 Paper- A Survey of
262140878_A_Survey_of_Transportation_Problems
21 CES 1 Moodle Quiz -
Module IV - Assignment Problems

Chapter-6 How to use different
Assignment problem-Theoretical
Page No. 288 - models of OR to solve
Background
22 298 real life problems
Page No. 288 -
Hungarian Method of solution
298
How this method is used
Page No. 288 - to minimize the time, cost
23 Hungarian Method of solution
298 & distance while
assigning/allocating work
Page No. 299 - Enhancement of
24 Special Cases – Maximization, Restriction
305 analytical skills
Page No. 299 -

25 Special Cases – Multiple Solutions
305

26 Applications of Assignment Problem Notes Given
Discussion on Research Paper- (PDF) Application of Linear

27 Application of Linear Programming Programming (Assignment Model)
(Assignment Model) (researchgate.net)
28 CES 2 - Class Test -
Module V - Network Analysis
Introduction to Networks
Chapter-12
Network Models-PERT/CPM
Page No. 608 -
29 Network components & precedence 616
relationship How to achieve time and
cost optimization by
30 Rules of Network Construction
using this model of OR in
Page No. 617 - projects
31 Representing a Project as a Network
619
32 Practice of making a network
Page No. 619 -

33 Critical Path Method
620
Meaning, Definition and importance of Enhancement of

34
Floats Page No. 621 - analytical skills
Calculation of Floats –Total, Free & 624

35
Independent Floats
PERT-project completion time with three Page No. 638 -

36
time estimates 643
PERT-calculation of probability & Page No. 638 -

37
completion time 643
Discussion on Research Paper- (PDF) OPTIMIZATION OF TIMES AND COSTS OF

Optimization of times and costs of project PROJECT OF HORIZONTAL LAMINATOR
38
of horizontal laminator production using PRODUCTION USING PERT/CPM TECHNICAL
(researchgate.net)
pert/cpm technical
39 CES -3 (Quiz on Moodle) -
40 Discussion on Previous year question papers

9. MAPPING LECTURE WITH COURSE LEARNING OUTCOMES
LO1 LO2 LO3 LO4 LO5
LECTURE1 High
LECTURE2 High Medium
LECTURE10 High
LECTURE11 High Medium Low
LECTURE17 High
LECTURE18 High
LECTURE19 High
LECTURE20 High

LECTURE25 High
LECTURE28 High
LECTURE29 High
LECTURE30 High

LECTURE37 High
LECTURE38 High
LECTURE39 High
LECTURE40 High

10. Contact Details:
Dr. Bhawna Duggal,

Dr. Parul Agrawal,
Name of the Instructor:
Dr. Nancy Goel,
Dr. Vinod Jangid
Office Location: Paschim Vihar
8588990881;
9811880805;
Telephone:
9015428965;
9871025388
Bhawna.dhawan@bharatividyapeeth.edu;
Email: parul.agarwal@bharatividyapeeth.edu;
Nancy.goel@bharatividyapeeth.edu;
vjangid349@rediffmail.com

Unit 1 – Introduction to Operations Research
Operations
The activities carried out in an organization.
Research
The process of observation and testing characterized by the scientific method.
Operations Research is a quantitative approach to decision making based on the scientific method of
problem solving.
Definitions of Operations Research
 Operations research is the application of the methods of science to complex problems in the
direction and management of large systems of men, machines, materials and money in industry,
business, government and defence. The distinctive approach is to develop a scientific model of the
system incorporating measurements of factors such as chance and risk, with which to predict and
compare the outcomes of alternative decisions, strategies or controls. The purpose is to help
management in determining its policy and actions scientifically.
—Operational Research Society, UK
 Operations research is concerned with scientifically deciding how to best design and operate man–
machine systems usually requiring the allocation of scarce resources.
—Operations Research Society, America
 It is the use of scientific knowledge through interdisciplinary team effort for the purpose of
determining the best utilization of limited resources.
—Hamdy A Taha
 The application of scientific method to study of operations of large complex organizations or

activities. It provides top level administrators with a quantitative basis for decisions that will
increase the effectiveness of such organizations in carrying out their basic purpose.
—Committee on OR of National Research Council

Origin and Development of Operations Research
 Strategic and tactical problems – World war-II
The term ‘operations research’ was coined as a result of research on military operations
during World War II. Since expecting adequate solutions from individuals or specialists in a single
discipline was unrealistic, groups of individuals who collectively were considered specialists in
mathematics, economics, statistics and probability theory, engineering, behavioural, and physical
science were formed. In Britain, Col. P. M. S. Blackett was assigned the problem of analysing the
coordination of radar equipment at gun sites
 Adoption in other fields
After the war, scientists who had been active in the military operations research (OR) groups
made efforts to apply operations research approach to civilian problems, related to business,
industry, research and development, etc.
 Economic and industrial boom
After World War II, economic and industrial boom resulted in continuous mechanization,
automation, decentralization of operations and division of management functions. Therefore
application of operations research to managerial decision-making became popular.
Characteristics of Operations Research
 Use of Scientific Methods
 Use of Models to represent the complex relationship
 Interdisciplinary approach
 Provision of a quantitative basis for decision making
 Methodological Approach
 Decision-making
 Operations Economy
Applications/Scope of Operations Research
 Areas
• Finance
• Production
• Marketing
• Personnel

 Techniques
• Linear Programming
• Decision Models
• Network Theory
• Inventory Control
• Queuing Theory
• Sequencing
• Game Theory
• Simulation

Advantages of Operations Research
 Better Decision-making
 Better control
 Better Co-ordination
 Helpful in complex situations
 Resolve conflicts
 Improves Productivity
Limitations of Operations Research
 Magnitude of Computation
 Non-Quantifiable Factors
 Distance between User and Analyst
 Time and Money Costs
 Implementation

Unit 2- Linear Programming Problem
Definitions
Linear programming is a mathematical technique useful for allocation of ‘scarce’ or ‘limited’ resources, to
several competing activities on the basis of a given criterion of optimality.
The word ‘linear’ refers to linear relationship among variables in a model. That is, a change in one
variable causes a resulting proportional change in other variable. The word ‘programming’ refers to the
solution of a problem that involves the economic allocation of limited resources, by choosing a particular
course of action or strategy among various alternative strategies in order to achieve a desired objective.
Components of an LPP
• Decision Variables
• Objective Function
 To maximize or minimize
• Constraints
 Involving ≤, =, or ≥ sign
• Non-negativity Condition
 Variables to be non-negative
Assumptions underlying Linear Programming
 Proportionality
 Additivity
 Continuity
 Certainty
 Finite Choices
Graphic Solution to LPPs
 Plot constraints
 Mark feasible region which should be a convex set
 Evaluate corner points/use iso-profit or iso-cost lines to get optimal solution
 Redundant constraints
 Binding constraints
 Non-binding constraints

Solutions to LPPs
• Unique Optimal Solution
• Multiple Optimal Solutions
• Infeasibility: No feasible solution
• Unbounded Solution
Advantages of Linear Programming
• Linear programming helps in attaining the optimum use of productive resources. It also indicates
the use of productive factors effectively by selecting and distributing (allocating) these resources.
• Linear programming technique improves the quality of decisions. In other words, decision-making
approach becomes more objective and less subjective.
• Linear programming technique provides possible and practical solutions by taking into account the
constraints operating outside the problem.
• Linear programming also helps in re-evaluation of the outcome due to a course of action under
changing conditions. This helps to adjust the remainder of the decision process for best results.
Limitations of Linear Programming
• Linear programming treats all relationships among decision variables as linear. However, in real
life neither the objective function nor the constraints concerning business and industrial problems
are linearly related to the variables.
• While solving an LP model, there is no guarantee to get an integer valued solution. Rounding off
the solution to the nearest integer will not yield an optimal solution. In such cases, integer
programming is used to ensure integer value to the decision variables.
• Linear programming model does not take into consideration the effect of time and uncertainty.
• Parameters of LP model are assumed to be constant but in real-life situations, they are neither
known nor constant.
• A LP model has single objective function, whereas in real-life situations we may come across
conflicting multi-objective problems. In such cases, a goal programming model is used to get
satisfactory value of such objectives.

Practice Questions
Q-1 A firm produces three products A, B & C each of which passes through three departments:
Fabrication, Finishing & Packaging. Each unit of product A requires 3, 4 & 2; a unit of product B requires
5, 4 & 4 while each unit of product C requires 2, 4 & 5 hours respectively in the three departments. Every
day 60 hrs are available in the fabrication department, 72 hrs in the finishing department and 100 hrs in
the packaging department. The unit contribution of product A is Rs. 5, of product B is Rs. 10 and of
product C is Rs. 8. Formulate the problem as LPP.
Q-2 The agricultural research institute suggested the farmer to spread out at least 4800 kg of special
phosphate fertilizer and not less than 7200 kg of a special nitrogen fertilizer to raise the productivity of
crops in his fields. There are two sources for obtaining these – mixtures A and mixtures B. Both of these
are available in bags weighing 100kg each and they cost Rs.40 and Rs.24 respectively. Mixture A contains
phosphate and nitrogen equivalent of 20kg and 80 kg respectively, while mixture B contains these
ingredients equivalent of 50 kg each. Write this as an LPP and determine how many bags of each type the
farmer should buy in order to obtain the required fertilizer at minimum cost.
Q-3 Chocolate India Ltd. produces three varieties of Chocolates – Hard, mild & soft from three
different inputs I1, I2 & I3. One unit of Hard requires 2 units of I 1 and 4 unit of I2. One unit of mild
requires 5 units of I1, 4 units of I2 and 3 units of I3 and one unit of soft requires 10 units of I1 & 15 units
of I3. The total available of inputs in the company’s warehouse is as under:
I1 - 100 units
I2 - 400 units
I3 - 50 units
The profit per unit for hard, mild & soft are Rs. 20, Rs. 30 and Rs. 40 respectively. Formulate the problem
so as to maximize the total profit by using linear programming.
Q-4 Safe & sound Investment Ltd. wants to invest up to Rs. 10 lakhs into various bonds. The
management is currently considering four bonds, the detail on return & maturity of which are as follows:
Bonds Types Returns Maturity Time

α Govt. 22% 15 years
β Govt. 18% 5 years
γ Industrial 28% 20 years
θ Industrial 16% 3 years
The company has decided not to put less than half of its investment in the government bonds and that the
average age of the portfolio should not be more than 6 years. The investment should be such which
maximizes the return on investment, subject to the above restriction. Formulate the above as a LP
problem.

Q-5 To maintain good health, a person must fulfill certain minimum daily requirements of several
kinds of nutrients. For the sake of simplicity let us assume that only three kinds of these needs to be
considered calcium, protein vitamin A. also assume that the person’s diet is to consist of only 2 food
items, I & II; whose prices & nutrient content’s are given in the following table. Find out the optimal
combination of the two food items that will satisfy the daily requirements & entail the least cost.
Foods Calcium Protein Qty Vitamin A Qty Cost per Unit

F1 10 5 2 6
F2 4 5 6 1
Daily Min. Requirements 20 20 12
Q-6 A steel plant manufactures two grades of steel S 1 & S2. Data given below shows the total
resources consumed & profit per unit associated with S1 & S2 .iron and labor are the only resources which
are consumed in the manufacturing process. The manager of the firm wishes to determine the different
units of S1 & S2 which should be manufactured to maximize the total profit.
Resource utilized Unit-requirement Amount Available

S1 S2
Iron (kg) 30 20 300
labour (Hours) 5 10 110
Profit (Rs.) 6 8
Q-7 A manufacturer produces two types of models M1 and M2.Each model of the type M1 requires 4
hours of grinding and 2 hours of polishing; whereas each model of M2 requires 2 hours of grinding and 5
hours of polishing. The manufacturer has 2 grinders and 3 polishers. Each grinder works for 40 hours a
week and each polisher works 60 hours a week. Profit on M1 model is Rs.3.00 and on model M2 is
Rs.4.00.Whatever produced in a week is sold in the market. How should the manufacturer allocate his
production capacity to the two types of models, so that he makes maximum profit in a week? = 3
X
Q-8 Alpha Limited produces & sells 2 different products under the brand name black & white. The
profits per unit on these products are Rs. 50 & Rs. 40 respectively. Both black & white employ the same
manufacturing process which has a fixed total capacity of 50,000 man-hours. As per the estimates of the
marketing research department of Alpha Limited, there is a market demand for maximum 8,000 units of
Black & 10,000 units of white. Subject to the overall demand, the products can be sold in any possible
combination. If it takes 3 hours to produce one unit of black & 2 hours to produce one unit of white,
formulate the about as a linear programming model.
4X1 + 2X2 < 80 2X1 + 5X2 < 180 X1, X2 > 0
Q-9 A person wants to decide the constituents of a diet which will fulfill his daily requirements of
proteins, Fats & carbohydrates at the minimum cost. The choice is to be made from four different
types of foods. The yield per unit of these foods is:
Yield Per Unit Cost per Unit

Food Type
Proteins Fats Carbohydrates (Rs.)
1 3 2 6 45
2 4 2 4 40
3 8 7 7 85
4 6 5 4 65
Minimum
800 200 700
Requirement
Formulate the linear programming model for the problem.
Q-10 High Quality furniture Ltd. manufactures two products, tables & chairs. Both the products have to
be processed through two machines Ml & M2 the total machine-hours available are: 200 hours ofM1 and
400 hours of M2 respectively. Time in hours required for producing a chair and a table on both the
machines is as follows:
Time in Hours
Machine Table Chair
M1 7 4
M2 5 5
Profit from the Sale of table is Rs. 40 and that from a chair is Rs. 30, determine optimal mix of tables &
chairs so as to maximize the total profit.

Q-11 Good Results Company manufactures & sells in the export market three different kinds of
products P1, P2 & P3. The anticipated sales for the three products are 100 units of P1, 200 units of P2 &
300 units of P3. As per the terms of the contract Good results must produce at least 50 units of P 1 & 70
units of P3. Following is the break – up of the various production lines:
Product Production Hours per Unit Unit Profit

(Rs.)
Department Department Department Department

(A) (B) (C) (D)
P1 0.05 0.06 0.07 0.08 15
P2 0.10 0.12 0.30 20
P3 0.20 0.09 0.07 0.08 25
Available 40.00 45.00 50.00 55.00

hours
Management is free to establish the production schedule subject to the above constraints.
Formulate as a linear programming model assuming profit maximization criterion for Good Results
Company.
Q-12 The management of Surya Chemicals is considering the optimal mix of two possible processes.
The values of input & output for both these process are given as follows:
Process Inputs Units Outputs Units
I1 I2 O1 O2
X 2 6 3 7
Y 4 8 5 9

Maximum 500 units of Input I1 and 300 units of I2 are available to Surya Chemicals in the local market.
The forecasted demand for outputs OI & O2 are at least 5,000 units & 7,000 units respectively. The
respective profits from process X & Y are Rs. 1,000 & Rs. 2,000 – per production run. You are required to
formulate the above as a linear programming model.
Solve using Graphical Method
Q-13 A small scale industry manufactures electrical regulators, the assembly of which is being
accomplished by a small group of skilled workers, both men and women. Due to the limitations of space
and finance, the number of workers employed cannot exceed 11 and their salary bill not more than Rs.
60,000 per month. The male members of the skilled workers are paid Rs. 6000 per month, while the
female worker doing the same work as the male member get Rs. 5000 member contributes Rs. 10,000 per
month to total return of the industry, while the female worker contributes Rs. 8500 per month. Determine
the number of male and female workers to be employed in order to maximize the monthly total return.
(maximization- bounded- unique)
Q-14 Maximize: z=2x1 + x2 (Bounded- Unique)
Constraints:
x1 + 2x2 ≤ 360
x1 + x2 ≤ 6
x1 - x2 ≤ 2
x1 - 2x2 ≤ 1
x1, x2 ≥ 0
Q-15 MD Ltd. has two bottling plants, one located at Solan and the other at Mohan Nagar. Each plant
produces three drinks; whisky, beer and fruit juices name A, B, C respectively. The number of bottles
produced per day is as follows:
Plant at
Solan Mohan Nagar
Whisky 1500 1500
Beer 3000 1000

Fruit Juices 2000 5000
A market survey indicates that during the month of April, there will be a demand of 20,000 bottles of
whisky, 40,000 bottles of beer and 44,000 bottles of fruit juices. The operating costs per day for plants at
Solan and Mohan Nagar are 600 & 400 monetary units. For how many days each plant is run in April so
as to minimize the production cost while still meeting the market demand?(Unbounded- Minimization-
Unique)
Q-16 Use the graphical method to solve the LP problem. (Minimize- Bounded with negative
coordinates- Unique (negative) solution)
Minimize Z = − x1 + 2x2
Subject to the constraints
−x1 + 3x2  10
x1 + x2  6
x1 − x2  2
And x1, x2 ≥ 0.
Q-17 Solve the following problem graphically (Maximize- Unbounded- Infinite)
Max Z= 5X1+4X2
Subject to X1-2X2 ≤ 1
X1+2X2 ≥ 3
X1, X2 ≥ 0
Q-18 Solve the following problem graphically: (Maximize- Bounded- Unique)
Max Z= -X1+2X2
Subject to
X1-X2≤ -1
-0.5 +X2 ≤ 2
X1, X2 ≥ 0
Q-19 Maximize Z=4x1 + 3x2 (Bounded- Multiple optimal)

3x1 + 4x2 ≤ 24
8x1 + 6x2 ≤ 48
x1 ≤ 5
x2 ≤ 6
x1, x2 ≥ 0
Q-20 Maximize: z=4x1 + 2x2 (Unbounded- Infeasible)
Constraints:
2x1 + 3x2 ≤ 18
x1 + x2 ≥ 10
x1, x2 ≥ 0
Q-21 An advertising firm desires to reach two types of audiences- customers with annual income of
more than Rs. 40,000 (target audience A) and customers with annual income of less than Rs. 40,000
(target audience B). The total advertising budget is Rs.2, 00,000. One programme of T.V advertising costs
Rs.50, 000 and one programme of radio advertising costs Rs. 20,000. Contract conditions ordinarily
require that there should be atleast3 programmes on T.V and the number of programmes on Radio must
not exceed 5. Survey indicates that a single T.V programme reaches 7, 50,000 customers in target
audience A and 1, 50,000 in target audience B. One Radio programme reaches 40,000 customers on target
audience A and 2, 60,000 in target audience B. Formulate this as a LPP and determine the media mix to
maximize the total reach using graphic method. (Maximize- Bounded- Unique)

NOTES
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Unit III: Transportation Problems
Inputs:
 Sources with availability
 Destinations with requirements
 Unit cost of transportation from various sources to destinations
Objective:
 To determine schedule of transportation to minimize total transportation cost
Transportation Method
Step 1
Balance the problem if Aggregate Demand and Aggregate Supply are unequal; place an M in the cost
cell if some route is prohibited; and convert into equivalent minimization problem if it is a maximization
problem.
Step 2
Obtain initial solution
 North-West Corner Rule: considers only demand and availability
 Least Cost Method: considers unit cost, demand and availability
 Vogel’s Approximation Method: considers cost differences, demand and availability
Step 3
Test for optimality
For this, check if the number of occupied cells = m + n – 1
If yes, obtain ui and vj values and calculate ∆ij values for unoccupied cells
 If all ∆ij values are ≤ 0, it is optimal solution
 If all ∆ij values are negative, it is unique optimal solution
 If some ∆ij value/s = 0 while others are negative, there are multiple optimal solutions
In case of non-optimal solution go to step 4

Step 4
Improve non-optimal solution
(a) Begin with cell having largest ∆ij, draw a closed path:
 Move alternately between rows and columns
 Stop only at occupied cells
 Start with a + sign in the cell of origin, place – and + signs alternately on cells on the path
(b) Consider cells with – sign, choose the least quantity in them, add it to each cell with + sign and
subtract it from each cell with – sign
(c) Obtain revised solution and go back to step 3
Special Cases in Transportation Problem

Unbalanced Transportation Problem
A problem is known to be unbalanced problem if Aggregate Demand and Aggregate Supply are unequal;
the first step is to make it balanced by adding a dummy row or dummy column as per the requirement &
placing zero in all the cost cells of that dummy row or dummy column.
Transportation Problem of Maximization
If a problem is of maximization (instead of cost profit /saving is given) then convert it into equivalent
minimization problem by subtracting all the values from the highest value.
Prohibition in Transportation Problem
If some routes are prohibited in the problem then place an M (which denotes vary high cost) in the cost
cell which is prohibited and then solve in usual manner.
Degeneracy in Transportation Problem
If the basic feasible solution of a transportation problem with m origins and n destinations has fewer than
m+n-1 positive cij (Occupied cells), the problem is said to be a degenerate transportation problem.
Degeneracy occurs at two stages:
1) Initial Stage
2) During testing the optimal solution. (Prevents testing optimality of the solution)
Degeneracy is removed by placing an infinitesimally small value ε (Epsilon) in each of the required
number of independent cells

Practice Questions

Q-1 Find out the initial feasible solution using:
i) North West Corner Method,

ii) Least Cost Method/ Matrix Minima Method
iii) Row Minima method
iv) Column Minima Method
v) Vogel’s Approximation Method
Distribution Centers
A B C D Supply
Plants P 2 3 11 7 6
Q 1 0 6 1 1
R 5 8 15 9 10
Requirements 7 5 3 2
Q-2 Find the optimal transportation cost using: MODI Method
P Q R S Supply
A 12 10 12 13 500
B 7 11 8 14 300
C 6 16 11 7 200
Demand 180 150 350 320 1000
Q-3 Given the following transportation problem:
Market
Warehouse Supply
A B C
1 10 12 7 180
2 14 11 6 100
3 9 5 13 160
4 11 7 9 120
Demand 240 200 220
It is known that currently nothing can be sent from warehouse 1 to market A and from warehouse 3 to
market C. Solve the problem and determine the least cost transportation schedule. Is the optimal solution
obtained by you is unique? If not, what is/ are the other optimal solution/s?
Q-4 The following matrix gives the distance in kms, from source of supply to the destination. The
shipping cost is Rs. 10per km. What shipping schedule should be used to minimize total cost?

D1 D2 D3 D4 D5 Supply
S1 5 8 6 6 3 8
S2 4 7 7 6 5 5
S3 8 4 6 6 4 9
Demand 4 4 5 4 8
Q-5 Determine a transportation schedule to minimize cost using NWC Rule.
D1 D2 D3 Supply
S1 8 5 6 120
S2 15 10 12 80
S3 3 9 10 80
Demand 150 80 50
Q-6 There are four warehouses located at A, B, C and D with capacity of 90, 50, 80 and 60 tons
respectively. A supply has to be made in 3 cities P, Q and r with a demand of 120, 100 and 110 tons
respectively. The shipping cost per ton is given below:-
P Q R
A 7 10 5
B 12 9 4
C 7 3 11
D 9 5 7
 Shipments are prohibited from A to P. Find out the minimum cost.
Q-7 A company supplies the product from its warehouses to 4 cities. The profit per unit is given below.
Warehouse/City 1 2 3 4 Supply
A 6 6 11 15 80
B 4 6 10 12 120
C 6 4 7 6 150
D 4 10 14 14 70
E 8 8 7 9 90
Demand 100 200 120 80

Q-8 The table below records transportation costs per unit of a product from origins O1, O2, O3 and O4
to destinations D1, D2, D3, D4 and D5. The capacities of the four origins are respectively 55, 45, 30 and
50 while the requirements of the five destinations are respectively 40, 20, 50, 30 and 40.Employing
Vogel’s Approximation Method, or otherwise, make the initial allocations to the origins to satisfy the
requirements of the destinations and test the optimality of these allocations. Use Modified Distribution
Method (MODI) for obtaining an optimal solution that would minimize the total cost of transportation.
Destination
Origin Capacity
D1 D2 D3 D4 D5
O1 12 4 9 5 9 55
O2 8 1 6 6 7 45
O3 1 12 4 7 7 30
O4 10 15 6 9 1 50
Requirement 40 20 50 30 40
Find the total cost implied by the solution. Is the solution unique? If not, find an alternative solution as
well.
Q-9 A company has four warehouses and six stores. The warehouses altogether have a surplus of 22
units of a given commodity, divided among them as follows:
Warehouses 1 2 3 4
Surplus 5 6 2 9
The six stores altogether need 22 units of the commodity. Individual requirements at stores 1, 2,3,4,5 and
6 are 4, 4, 6, 2, 4 and 2 units respectively.
Cost of shipping one unit of commodity from warehouse to stores in rupees is given in the matrix below:
Stores
Warehouse
s 1 2 3 4 5 6
1 9 12 9 6 9 10
2 7 3 7 7 5 5
3 6 5 9 11 3 11
4 6 8 11 2 2 10
How the products should be shipped from the warehouses to the stores so that the transportation cost is
minimum?

Q-10 A company has received a contract to supply gravel to three new construction projects located in
towns A, B and C. The construction engineers have estimated that the required amounts of gravel which
will be needed at these construction projects are:
Project Location Weekly Requirements

(Truckloads)
A 72
B 102
C 41
The company has 3 gravel pits located in towns X, Y and Z. The gravel required by the construction
project can be supplied by three pits. The amount of gravel that can be supplied by each pit is as follows:
Plant: X Y Z
Amount Available 76 82 77
(Truckloads)
The company has computed the delivery cost from each pit to each project site. These costs (in Rs.) are
shown in the following table:
Project Location
A B C
Pit
4 8 8
16 24 16
8 16 24
Schedule the shipment from each pit to each project in such a manner that it minimizes the total
transportation cost within the constraints imposed by pit capacities and project requirements. Also find the
minimum cost.
Q-11 Find the optimum solution to the following transportation problem in which the cells contain the
transportation cost in rupees.
W1 W2 W3 W4 W5 Available
F1 7 6 4 5 9 40
F2 8 5 6 7 8 30
F3 6 8 9 6 5 20
F4 5 7 7 8 6 10
Required 30 30 15 20 5 100

Q-12 XYZ tobacco Company purchases tobacco and stores in warehouses located in the following four
cities:
Warehouse Location(City) A B C D
Capacity (Tons) 90 50 80 60
The warehouse supply tobacco to cigarette companies in three cities that have the following demand:
Cigarette Company Demand (Tons)

Bharat 120
Janta 100
Red Lamp 110
The following railroad shipping costs per tonne (in hundred rupees) have been determined:
Warehouse Location Bharat Janta Red Lamp

A 7 10 5
B 12 9 4
C 7 3 11
D 9 5 7
Because of railroad construction, shipments are temporarily prohibited from warehouse at city A to Bharat
Cigarette Company.
a) Find the optimum distribution for XYZ Tobacco Company.

b) Are there multiple optimum solutions? If yes, identify them.
Q-13 Find the initial solution for the transportation problem by VAM method. Also obtain the optimum
solution by MODI Method.
Market
Plant Supply
M1 M2 M3 M4
P1 6 4 9 1 40
P2 20 6 11 3 40
P3 7 1 0 14 50
P4 7 1 12 6 30
Demand 90 30 50 30

Q-14 A company manufacturing air – coolers has two plants located at Mumbai and Kolkata with a
capacity of 200 units and 100 units per week respectively. The company supplies the air – coolers to its
four showrooms situated at Ranchi, Delhi, Lucknow and Kanpur which have a maximum demand of 75,
100, 100 and 30 units respectively. Due to the differences in raw material cost and transportation cost, the
profit per unit in rupees differs which is shown in the table below:
Ranchi Delhi Lucknow Kanpur

Mumbai 90 90 100 110
Kolkata 50 70 130 85
Plan the production program so as to maximize the profit. The company may have its production capacity
at both plans partly or wholly unused.
Q-15 A product is manufactured at four factories A, B, C and D. Their unit production costs are Rs. 2,
Rs. 3, Re 1 and Rs. 5, respectively. Their production capacities are 50, 70, 30 and 50 units, respectively.
These factories supply the product to four stores, demands of which are 25, 35, 105 and 20 units
respectively. Unit transportation cost in rupees from each factory to each store is given in the table below:
Stores
Factories I II III IV
A 2 4 6 11
B 10 8 7 5
C 13 3 9 12
D 4 6 8 3
Determine the extent of deliveries from each of the factories to each of the stores, so that the total
production and transportation cost is the minimum.
Q-16 A company has factories at F1, F2 and F3 that supply products to warehouses at W1, W2 and W3.
The weekly capacities of the factories are 200, 160 and 90 units, respectively. The weekly warehouse
requirements are 180, 120 and 150 units, respectively. The unit shipping costs (in rupees) are as follows:
Warehouse
Factory Supply
W1 W2 W3
F1 16 20 12 200
F2 14 8 18 160
F3 26 24 16 90
Demand 180 120 150 450
Determine the optimal distribution for this company in order to minimize its total shipping cost.

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Unit IV: Assignment Problem
Assignment problem arises when each assignee (workers, salesmen, vehicles, contracts, etc.) is to be
assigned to exactly one task (sales regions, machines, checkout counters, routes, bidders, etc.) with an
objective to minimize the total cost/time/distance or to maximize total profit.
The problem of assignment arises because resources that are available have varying degree of efficiency
for performing different tasks. The cost, profit or time of performing different tasks is also different.
Assignment Problem
• Can be solved by complete enumeration
• Can be formulated and solved as a transportation problem
• Can be formulated and solved an LPP (a 0-1 IPP)
• Can be solved by Hungarian Assignment Method (HAM)
• HAM is most efficient of all methods
Hungarian Assignment Method
Step 1
 Balance the problem if it is unbalanced
 Place an M as the cost element if some assignment is prohibited
 Convert into equivalent min problem if it is a max problem
Step 2
Obtain zeros in every row and column by row reductions and column reductions
Step 3
Cover all zeros by least number of horizontal/ vertical lines
If number of lines = n move to step 4 else make adjustment: select least uncovered value; subtract it from
every uncovered value; and add to each one at intersection of lines
Again cover zeros with lines to find if you could go to 4
Step 4
Make assignments by considering zeros

Variations of the Assignment Problem
Multiple Optimal Solutions:
While making assignments, it is possible to have two or more ways to strike off a certain number
of zeros. This indicates that there are multiple optimal solutions with the same optimal value of
objective function.
Maximization Case in Assignment Problem:
If an assignment problem is for maximization of profit/revenue, then such problems are solved by
converting given data on profit/revenue into cost data as follows:
Locate largest payoff element in the assignment table and then subtract all elements of the table
from this element. The new assignment problem, so obtained, can be solved by using the
Hungarian method.
Unbalanced Assignment Problem
Hungarian method requires that the number of columns and rows in the assignment matrix be
equal. Otherwise, assignment problem is called an unbalanced problem. To make given matrix a
square matrix, dummy row(s) or column(s) are added (with zeros cost elements).
Prohibition in Assignment Problem
If some routes are prohibited in the problem then place an M (which denotes vary high cost) in the
cost cell which is prohibited and then solve in usual manner.

Pr
actice Questions
Q-1 To stimulate interest and provide an atmosphere for intellectual discussion, the finance faculty in
management school decides to hold special seminars on 4 contemporary topics- leasing, portfolio
management, mutual funds and swaps & options. Such seminars would be held once per week in the
afternoons. However, scheduling these seminars (1 for each topic and not more than 1 seminar in the
afternoon) has to be carefully done so that the number of students unable to attend is kept minimum.
A study indicates that the number of students who cannot attend a particular seminar on a specific day
is as follows:
Swaps &
Leasing Portfolio Management Mutual Funds
Options
Monday 50 40 60 20
Tuesday 40 30 40 30
Wednesday 60 20 30 20
Thursday 30 30 20 30
Friday 10 20 10 30
Find an optimal schedule of the seminars. Also find out the total number of students who will be
missing at least 1 seminar.
Q-2 A solicitor’s firm employs typists on hourly piece-rate basis for their daily work. There are 5
typists and their charges and speed are different. According to an earlier understanding, only 1 job is
given to 1 typist and the typist is paid for a full hour even when he works for a fraction of an hour. Find
the least cost allocation for the following data:
No. of pages
Typist Rate/hr (Rs) Job No. of pages
typed/hr
A 5 12 P 199
B 6 14 Q 175
C 3 8 R 145
D 4 10 S 298
E 4 11 T 178
Q-3 In a multi-storied building, there are 5 rooms to be assigned to 5 managers. Each room has its own
advantages and disadvantages. They are all of different shapes and sizes. Each of the 5 managers

was asked to rank their preferences amongst the rooms. Their preferences are recorded in the
below table:
Manager
M1 M2 M3 M4 M5
302 302 303 302 301
303 304 301 305 302
304 305 304 304 304
301 305 303
302
Most of the managers did not list all the 5 rooms since they were not satisfied with some of these rooms.
Assuming that their preferences can be quantified in numbers, find out as to which manager should be
assigned to which room so that their total preference ranking is minimum.
Q-4 A firm produces 4 products. There are 4 operators capable of producing any of these 4 products.
The firm records 8 hrs a day and allows 30 min for lunch. The processing time in minutes and
profit for each of the products is given below. Find the optimal assignment of products to
operators.
Operator A B C D
1 15 9 10 6
2 10 6 9 6
3 25 15 15 9
4 15 9 10 10
Profit/Unit 8 6 5 4

Q-5 A company has 4 sales representatives who are to be assigned 4 sales territories. The monthly sales
increase estimated for each sale representatives are shown below. Suggest optimal assignment so
as to maximize total sales per month.
Sales Sales Territories

Representatives I II III IV
A 200 150 170 220
B 160 120 150 140
C 190 195 190 200
D 180 175 160 190
If for certain reasons, sales representative B cannot be assigned to sales territory III, will the optimal
assignment schedule be different? If so, find that schedule and its effect on sales.
Q6. An airline, operating 7 days a week, has given the following schedule of its flights between New
Delhi and Mumbai. The crews should have a minimum of 5 hours between the flights. Obtain the
pairing of flights that minimizes layover time away from home. For any given pairing, the crew will
be based at the city that results in the smallest layover.
New Delhi-Mumbai Mumbai-New Delhi
Flight No. Departure Arrival Flight No. Departure Arrival
101 5 A.M. 7 A.M. 201 7 A.M. 9 A.M.
102 7 A.M. 9 A.M. 202 8 A.M. 10 A.M.
103 1 P.M. 3 P.M. 203 1 P.M. 3 P.M.
104 7 P.M. 9 P.M. 204 6 P.M. 8 P.M.

Q-7 A company proposes to undertake a national promotional campaign for its newly developed
product. It has decided to schedule a series of 1 minute commercials during peak audience viewing hours
of 1 P.M. - 5 P.M. To reach the widest possible audience the company wants to schedule 1 commercial on
each of the networks & to have only 1 commercial appear during each of the 4 one-hour time blocks. The
exposure ratings for each hour, which represent the number of of viewers per Rs. 10,000 spent, are given
below:
Network
Viewing Hours A B C D
1-2 P.M. 27.1 18.1 11.3 9.5
2-3 P.M. 18.9 15.5 17.1 10.6
3-4 P.M. 19.2 18.5 9.9 7.7
4-5 P.M. 11.5 21.4 16.8 12.8
a) Which network should be scheduled each hour to provide maximum audience exposure?
b) How would schedule change if it is decided not to use network A between 1-3 P.M.?

NOTES
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Unit-5 Network Analysis
Rules of Network Construction
1. Each activity is represented by one arrow
2. An activity can begin only when all its predecessors are done
3. Length and bearing of arrows is of no consequence
4. Arrow direction indicates general progression in time – tail events represent start while head
events represent end of activities
5. Events are identified by numbers while activities are represented by their starting and ending
events
6. A network should have only one initial and one final node
7. Introduce as few dummy activities as may be necessary
8. Looping is not permitted
Floats
 Total float is the amount of time by which an activity may be delayed without delaying the project
completion
 Caution: interpret total floats of activities carefully - all cannot be used independently
 Free float is that part of total float which can be used without affecting floats of the succeeding
activities
 The part of total float which is not free is called interfering float
 Independent float is the amount of time which can be used without affecting the head and the tail
events
Total Float ≥ Free Float ≥ Independent Float
 Total float = Latest start time – Earliest start time
 Free float = Total float – Head event slack
 Interfering float = Total float – Free float
 Independent float = Free float – Tail event slack, or zero, whichever is higher

PERT (Program Evaluation & Review Technique)
 Uses three time estimates for every activity: optimistic (a), most likely (m) and pessimistic (b)
 They are used to obtain expected times and their variances
Expected time = (a+4×m+b)/6; and
Variance = [(b – a)/6]2
 Obtain critical path using expected times and identify critical activities
 Add variances for critical activities to get variance for completion time and find its square root to
get standard deviation
 With expected duration and standard deviation, calculate probabilities of project completion using
normal distribution
PERT/Cost
 A modification of PERT which allows planning, monitoring and controlling of project cost and
duration
 Budgeting process allows to determine how much money is to be spent every time unit
(week/month) over planned duration of project
 Budgets are prepared on the basis of earliest and latest start times of activities
 Comparisons are made continuously between the actual costs and budgeted amounts
 Comparisons are also made between percentage of work done and percentage of budgeted amount
spent: if former is smaller than the later, we have budget overrun

Practice Questions
Q-1 Draw the Network diagram.
Activity Immediate predecessor

A -
B -
C -
D A
E C
F A
G D,B,E

A -
B A
C A
D C
E B,D
F E
G B,D
H F,G

A -
B A
C A
D B,C
E C
F D
G E
H F,G

A -
B -
C -
D A,B
E B,C
F A,B
G C
H D,E,F
I D
J G
K G
L H,J
M K
N I,L
Q-5 Draw the Network diagram and calculate critical path.
Expected completion Time

(weeks)
A - 5
B A 2
C A 6
D B 12
E D 10
F D 9
G D 5
H B 9
I C,E 1
J G 2
K F,I,J 3
L K 9
M H,G 7
N M 8
Q-6 Draw the Network diagram and calculate the following:

Optimistic Time Most Likely Pessimistic
Activity Predecessor
(WK) (WK) (WK)
A - 2 4 6
B - 6 6 6
C - 6 12 24
D A 2 5 8
E A 11 14 23
F B, D 8 10 12
G B,D 3 6 9
H C, F 9 15 27
I E 4 10 16
What is the Probability of completing the project one week before the expected time?
Calculate the schedule time of completion with 95% probability
Activity Optimistic Time (Days) Most Likely (Days) Pessimistic (Days)
1-2 3 6 15
1-6 2 5 14
2-3 6 12 30
2-4 2 5 8
3-5 5 11 17
4-5 3 6 15
5-8 1 4 7
6-7 3 9 27
7-8 4 19 28

a. Calculate the critical path & expected completion time
b. Calculate the probability of completing the jobs in 41 days.

Optimistic Time Most Likely

Activity Pessimistic (Days)
(Days) (Days)
1-2 1 2 3
2-3 1 2 3
2-4 1 3 5
3-5 3 4 5
4-5 2 3 4
4-6 3 5 7
5-7 4 5 6
6-7 6 7 8
7-8 2 4 6
7-9 4 6 8
8-10 1 2 3
9-10 3 5 7


(Days) (Days)
1-2 3 5 8
1-3 2 3 5
1-5 2 3 4
2-3 1 2 5
2-6 7 8 9
3-4 1 3 6
3-5 2 4 6
4-5 1 2 4
5-6 1 2 3

b. Calculate the schedule time of completion with 98% probability


(Days) (Days)
1-2 5 8 10
1-3 18 20 22
1-4 26 33 40
2-5 16 18 20
2-6 15 20 25
3-6 6 9 12
4-7 7 10 12
5-7 7 8 9
6-7 3 4 5

b. Calculate the probability OF COMPLETING THE PROJECT IN 41.5 DAYS.

(Days) (Days)
1-2 1 2 9
2-3 1 4 7
2-4 2 4 12
3-4 0 0 0
3-5 2 3 4
3-7 6 8 16
4-5 4 6 8
4-6 3 5 7
5-6 ½ 1 3/2
5-7 5 7 15
6-7 3 5 13

b. Calculate the probability OF COMPLETING THE PROJECT IN 25 DAYS.
c. Calculate the schedule time of completion with 98% probability


(Days) (Days)
10-20 4 8 12
20-30 1 4 7
20-40 8 12 16
30-50 3 5 7
40-50 0 0 0
40-60 3 6 9
50-70 3 6 9
50-80 4 8 6
60-100 4 6 8
70-90 4 8 12
80-90 2 5 8
90-100 4 10 16


(Days) (Days)
1-2 2 4 6
1-3 6 6 6
1-4 6 12 24
2-3 2 5 8
2-5 11 14 28
3-4 15 24 45
3-6 3 6 9
4-6 9 15 27
5-6 4 10 16


Optimistic Time
Activity Most Likely (Days) Pessimistic (Days)
(Days)
1-2 1 4 7
1-3 5 10 17
2-4 3 3 3
2-6 1 4 7
3-4 8 15 26
3-5 2 4 8
4-5 5 5 5
5-6 2 5 8
b. Calculate the probability OF COMPLETING THE PROJECT IN 5 days more than the expected
time.
Activity Optimistic Time (Days) Most Likely (Days) Pessimistic (Days)
1-2 1 2 3
1-3 1 2 3
1-4 0 0 0
2-5 1 2 3
2-6 2 5 8
3-7 3 4 5
4-8 3 5 7
5-9 4 6 8
6-9 2 3 4
7-8 3 4 5
8-9 4 6 8


NOTES
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Bharati Vidyapeeth Deemed University,
Institute of Management and Research (BVIMR), New Delhi
1st Internal Examination
Subject Introduction to Operations Research (BBA –V) Course Code: J010326
Max. Marks: 40 Max. Time: 2 Hours
Instructions: 1. Attempt all questions
2. Show the detailed calculations, wherever required
Q. 1 Attempt any five questions. Answer in 50 words [5 x 2]
a) Explain Unbalanced Transportation Problem with the help of an example.
b) Find the initial Basic Feasible Solution using NWC method:
P Q R SUPPLY
A 7 5 10 100
B 20 9 23 50
C 8 21 7 200
DEMAND 120 170 60
c) Find the initial Basic Feasible Solution using Least Cost method:
W1 W2 W3 SUPPLY
I 4 6 8 300
II 4 2 9 200
III 8 7 10 500
DEMAND 400 200 300
d) Write the applications of Linear Programming.

e) Explain infeasibility in LPP with example.
f) Write the various steps of solving transportation problem using Vogel’s Approximation Method.
g) Explain how to deal with Maximization case in transportation with a suitable example.
h) What is Degeneracy in transportation Problems?
Q. 2 Attempt any two questions. Answer in 200 words [2x 5]
a) Discuss the advantages & limitations of LPP.
b) Explain the graphical method of solving Linear Programming Problems?
c) What is the history of Operations Research?
Q.3 Attempt any two questions. Answer in 200 words [2 x 5]
a) A medical scientist claims to have found a cure for the common cold that consists of three drugs
called K, S and H. His results indicate that the minimum daily adult dosage for effective treatment
is 10 mg. of drug K, 6 mg. of drug S, and 8 mg. of drug H. Two substances are readily available
for preparing pills or drugs. Each unit of substance A contains 6 mg., 1 mg. and 2 mg. of drugs K,
S and H respectively, and each unit of substance B contains 2 mg, 3 mg, and 2 mg., of the same
drugs. Substance A costs Rs. 3 per unit and substance B costs Rs. 5 per unit. Find the least-cost
combination of the two substances that will yield a pill designed to contain the minimum daily
recommended adult dosage.
b) A car company is faced with an allocation problem resulting from rental agreement that allow cars
to be transported to locations other than those which they were originally rented. At the present
time there are two centers with 15 and 13 cars available respectively and 4 locations requiring 9, 6,
7 and 9 cars respectively. The unit transportation costs between the location are given below:-
Destinations/ Sources D1 D2 D3 D4
S1 45 17 21 30
S2 14 18 19 31
Obtain the minimum cost schedule.

c) Use the graphical method to solve the LPP.
Minimize Z = -X + 2Y
-X+ 3Y ≤ 10
X+Y≤6
X–Y≤2
And X, Y ≥ 0
Q.4 Attempt any one. Answer in 600 words [10 x 1]
a) An airplane can carry a maximum of 200 passengers. A profit of Rs. 200 is made on each of the first class
ticket and a profit of Rs 300 is made on each of economy class ticket. The airline reserves at least 20 seats
for first class. However, at least 4 times as many passengers prefer to travel by economy class than by the
first class. How many tickets of each class must be sold in order to maximize profit for the airline?
Formulate the problem and find the solution using graphical method.
b) Consider the transportation Problem presented in the following table:-
Distribution Centre
Plant D1 D2 D3 D4 Supply
P1 19 30 50 12 7
P2 70 30 40 60 10
P3 40 10 60 20 18
Requirement 5 8 7 15 35

Determine the optimal solution of the above problem.
Bharati Vidyapeeth Deemed University,

Institute of Management and Research (BVIMR), New Delhi
2nd Internal Examination
Course BBA Semester V Subject: Introduction to Operations Research Course Code: J010330
Max. Marks: 40 Max. Time: 2:00 Hours
--------------------------------------------------------------------------------------------------------------------------------
---
Instructions: - (use of Simple 10 digits Calculator is allowed)
Q. 1 Attempt any five questions: [5 x 2]
a) Draw the Network diagram
Activity A B C D E F G H I J
Predecessor - A - C B,C C F D,E,G D,E H,I
b) Define critical path.

c) Define Total Float.
d) What do you understand with expected time?
e) Define Independent Float
f) How do you balance an unbalanced assignment problem?
g) How do you handle maximization case in Assignment Problem? Show with example.
h) Discuss advantages & disadvantages of Monte Carlo Method.
Q. 2 Attempt any two questions: [2 x 5]
a) Differentiate between PERT & CPM
b) Write short note on simulation.
c) Discuss Hungarian method of solving assignment problem.
Q.3 Attempt any two questions: [2 x 5]
a) A Sales Manager wishes to assign four sales territories to four sales persons. The Sales person
differ in their Sales acumen and consequently the sales expected to be effected in each territory are
different for each sales person. The estimates of sales per month in thousands of rupees for each
sales person in each territory are given below:
Sales Person/Sales
T1 T2 T3 T4
territories
P 56 25 32 45
Q 45 21 54 26
R 21 54 36 45
S 34 35 28 52
Find an optimal schedule to maximize the total sales revenue.

b) A company selling water heaters examines it sales over the past 50 days and notes the following:
Hot Water Heater Sales per day No. of days this heater was sold
4 6
5 5
6 9
7 12
8 8
9 7
10 3
Using the following random numbers, simulate the demand for next 20 days and also calculate the
average demand per day?
10, 24, 03, 32, 23, 59, 95, 34, 34, 51, 08, 48, 66, 97, 03, 96, 46, 74, 77, 44
c) Complete the following table:
Activit Predecesso Duratio

ES EF LS LF TF HS FF TS IF
y r n
A I 12 12 24 0 0
B H,F 14 39 53 0 0
C D 20 19 42 3 10
D I 7 12 29 10 0
E C,G 11 39 53 0 3
F A,D 7 24 39 0 5
G A,D 13 24 42 3 5
H A 15 24 39 0 0
I - 12 0 12 0 0
Q.4 Attempt any one question: an [1 x 10]
a) Draw Network diagram, Calculate Critical path. Expected project Completion time. Also calculate
the probability of completing the project in less than 5 days & greater than 3 days of expected
completion time of the project.
Activity Predecessor Optimistic time (Days) Most Likely time (Days) Pessimistic Time (Days)
A - 7 9 17
B A 5 7 15
C A 1 8 9
D B 9 13 23
E B 6 10 20
F B,C 10 15 20
G B,.C 5 6 13
H D,F 12 17 28
b) Inter arrival and service times studied over past few years for a single channel queuing system
revealed the following patterns:
Inter Arrival Times (In Mins) Probability Service Times (In Mins) Probability
2 .19 1 .15
4 .22 3 .28
6 .32 5 .30
8 .17 7 .17
10 .10 9 .10
Using the following random no, simulate the queue behavior for a period of 60 minutes. Also calculate
waiting time of server & customers.

Random No. for inter arrival time: 19 32 59 81 27 45 26 52 77 46 85 83 34 42 43 07 17 23
Random No for Service times: 08 27 74 96 48 07 65 78 92 49 12 63 10 06 97 53 48 7

Sample MCQs
Operations Research (OR), which is a very powerful tool for ----------------

A. Research
B. Decision – Making
C. Operations
D. None of the options given
ANSWER: B
This innovative science of Operations Research was discovered during -------------
A. Civil War
B. World War I
C. World War II
D. Industrial Revolution
ANSWER: C
Operations Research has the characteristics that it is done by a team of -----------------
A. Scientists
B. Mathematicians
C. Academics
ANSWER: A
There is a great scope for ------------ working as a team to solve problems of defence by using the
Operations Research approach
A. Economists
B. Administrators
C. Statisticians and Technicians
D. All of the options given
ANSWER: D
Operations Research emphasizes on the overall approach to the system. This characteristics of
Operations Research is often referred as
A. System Orientation
B. System Approach
C. Interdisciplinary Team Approach
D. All of the options given
ANSWER: D

Operations Research cannot give perfect ------------------ to problems
A. Answers
B. Solutions
C. Answers and Solutions Both
D. Decisions
ANSWER: C
Operations Research simply helps in improving the -------------- of the solution but does not result
in a perfect solution.
A. Quality
B. Clarity
C. Look
ANSWER: A
Operations Research involves ------------------- attack of complex problems to arrive at the
optimum solution
A. Scientific
B. Systematic
C. Statistical
D. Scientific and Systematic both
ANSWER: D
A feasible solution is called a basic feasible solution if the number of allocations/occupied cells is
equal to
A. m-n+1
B. m-n-1
C. m+n-1
ANSWER: C
Any feasible solution to a transportation problem containing m origins and n destinations is said to
be
A. Independent
B. Degenerate
C. Non-degenerate
ANSWER: C

A path formed by allowing horizontal and vertical lines and the entire corner cells of which are
occupied is called a
A. Occupied path
B. Closed path
C. Open path
ANSWER: B
Transportation algorithm can be used for minimizing the transportation cost of ------------ from O
origins and D destinations
A. Goods
B. Products
C. Items
ANSWER: A
If demand is lesser than supply then dummy demand node is added to make it a ----------------
A. Simple problem
B. Balanced problem
C. Transportation problem
ANSWER: B
ABC Limited produces & sells 2 different products under the brand name black & white. The
profit per unit on these products in Rs. 50 & Rs. 40 respectively. Both black & white employ the
same manufacturing process which has a fixed total capacity of 50,000 man-hours. As per the
estimates of the marketing research department of ABC Limited, there is a market demand for
maximum 8,000 units of Black & 10,000 units of white. Subject to the overall demand, the
products can be sold in any possible combination. If it takes 3 hours to produce one unit of black &
2 hours to produce one unit of white, Which is the objective function?
A. Max Z= 50x1 - 40x2
B. Min Z= 50x1 + 40x2
C. Min Z= 50x1 - 40x2
D. Max Z= 50x1 + 40x2
ANSWER: D
Free Float is the difference of Head slack & Tail Slack
A. True
B. False
ANSWER: B

In. L.P.P.....................
A. objective function is linear
B. constraints are linear
C. Both objective function and constraints are linear
D. None of the option is correct.
ANSWER: C
XYZ Limited produces & sells 2 different products under the brand name black & white. The
profit per unit on these products in Rs. 50 & Rs. 40 respectively. Both black & white employ the
same manufacturing process which has a fixed total capacity of 50,000 man-hours. As per the
estimates of the marketing research department of XYZ Limited, there is a market demand for
maximum 8,000 units of Black & 10,000 units of white. Subject to the overall demand, the
products can be sold in any possible combination. If it takes 3 hours to produce one unit of black &
2 hours to produce one unit of white, Which is the Constraint?
A. 3x1 + 2x2 less than equal to 50000
B. 3x1 + 2x2 greater than equal to 50000
C. 3x1 - 2x2 less than equal to 50000
D. 3x1 - 2x2 greater than equal to 50000
ANSWER: A
A network may have more than one critical path.
A. True
B. False
ANSWER: A
Critical Activities are the least important activities of the network.
A. True
B. False
ANSWER: B
Critical path is known to be the shortest path in a network diagram.
A. True
B. False
ANSWER: B
Total Float is the difference of Latest finish and Latest start times.
A. True
B. False
ANSWER: B

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COURSE PACK

Course Instructors: Dr. Parul Agrawal

Bharati Vidyapeeth University

1|Page For Internal Circulation

Established in 1992, Bharati Vidyapeeth (Deemed to be University) Institute of Management and

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Dr. Parul Agrawal

Dr. Bhawna Dhawan

3|Page For Internal Circulation

Dr. Vinod Kumar Jangid

4|Page For Internal Circulation

Introduction to Operations Research

Linear Programming Problem (LPP)

5|Page For Internal Circulation

6|Page For Internal Circulation

1. Course Code: 505 Credits: 4

7|Page For Internal Circulation

After undergoing this course, the student will be able to:

5. List of Topics/ Modules:

Topic/ Module Contents/ Concepts

 Definition, Meaning & Significance

8|Page For Internal Circulation

Component Description Weightage for

It will be based on conceptual questions and situation specific

There will be two Internal exams of 10 % weight age each. They

Students will be awarded marks for active and constructive

Students will be Evaluated 3 times through any of the CES

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You tube Links

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History of OR; Meaning & Significance of

Module II - Linear Programming

Theoretical concepts of Linear To develop the skill and

Solution by graphical methods-

Discussion on Research Paper- LINEAR

11 | P a g e For Internal Circulation

21 CES 1 Moodle Quiz -

Module IV - Assignment Problems

Page No. 299 -

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Discussion on Research Paper- (PDF) Application of Linear

28 CES 2 - Class Test -

Module V - Network Analysis

Page No. 619 -

Meaning, Definition and importance of Enhancement of

Calculation of Floats –Total, Free & 624

PERT-project completion time with three Page No. 638 -

PERT-calculation of probability & Page No. 638 -

Discussion on Research Paper- (PDF) OPTIMIZATION OF TIMES AND COSTS OF

40 Discussion on Previous year question papers

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LO1 LO2 LO3 LO4 LO5

LECTURE2 High Medium

LECTURE3 High Medium

LECTURE4 High Medium

LECTURE5 High Medium

LECTURE6 High Medium

LECTURE7 High Medium

LECTURE8 High Medium

LECTURE9 High Medium

LECTURE11 High Medium Low

LECTURE12 High Medium

LECTURE13 High Medium