NATIONAL UNIVERSITY OF SCIENCE & TECHNOLOGY

DEPARTMENT OF INSURANCE & ACTURIAL SCIENCE

QUANTITATIVE ANALYSIS FOR BUSINESS CIN 1106

TUTORIAL TWO: LINEAR PROGRAMMING

1. A small manufacturer produces 2 kinds of goods, A and B, for which demand exceeds
capacity. The production costs for A and B are $6 and $3, respectively, and the
corresponding selling prices are $7 and $4. In, addition the transport costs are 20 cents
and 30 cents for each good of type A and B, respectively. The conditions of a bank
loan limit the manufacturer to maximum weekly production costs of $ 2700 and
maximum weekly transport costs of $120. How should the manufacturer arrange
production to maximize profit? Use (i) Graphical Method (ii) Simplex Method.
2. An electronics firm decides to launch 2 new models of computers, COM 1 and COM
2. The cost of producing each machine of type COM 1 is $ 1200 and the cost for
COM 2 is $1600. The firm recognizes that this is a risky venture and decides to limit
the total weekly production costs to $ 40000. Also due to a shortage of skilled labour,
the total number of computers that the firm can produce in a week is at most 30. The
profit made on each machine is $600 for COM 1 and $700 for COM 2. How should
the firm arrange production to maximize profit? Use (i) Graphical Method (ii)
Simplex Method.
3. A food producer uses 2 processing plants, P1 and P 2, which operate 7 days a week.
After processing, beef is graded into high, medium and low quality foodstuffs. High
quality beef is sold to butchers, medium quality beef is used in supermarket ready-
meals and the low quality beef is used in dog food. The producer has been contracted
to provide at least 120 kg of high, 80 kg of medium and 240 kg of low quality beef
each week. It costs $ 4000 per day to run plant P1 and $3200 per day to run P2. Each
day P1 processes 60kg of high quality beef, 20kg of medium quality beef and 40kg of
low quality beef. The corresponding quantities for P2 are 20 kg, 20 kg and 120kg
respectively. How many days each week should the plants be operated to fulfil the
beef contract most economically? Use the Graphical method.
4. A small publishing company decides to use one section of its plant to produce 2
textbooks entitled Microeconomics and Macroeconomics. The profit made on each
copy is $12 form Microeconomics and $18 for Macroeconomics. Each copy of
Microeconomics requires 12 minutes for printing and 18 minutes for binding, the
corresponding figures for Macroeconomics are 15 minutes and 9 minutes
respectively. There are 10 hours available for printing and 10.5 hours available for
binding. How many of each textbook should be produced to maximize profit? Use (i)
Graphical Method (ii) Simplex Method.
5. A manufacturer produces 2 models of racing bikes, B and C, each of which must be
processed through 2 machine shops. Machine shop 1 is available for 120 hours per
month and machine shop 2 for 180 hours per month. The manufacture of each bike of
type B takes 6 hours in shop 1 and 3 hours in shop 2. The corresponding times for C
are 4 and 10 hours respectively. If the profit is $180 and $220 per bike of type B and
C respectively, how should the manufacturer arrange production to maximize total
profit? Use (i) Graphical Method (ii) Simplex Method.
6. A sandwich factory employs qualified staff at $20 per hour and students at $10 per
hour. The former produce sandwiches at the rate of 60 per hour, while the latter
produce them at the rate of 50 per hour. To provide appropriate supervision, the
number of hours worked by qualified staff must be at least as great as the number
worked by students. In a period when at least 880 sandwiches are to be produced, for
how many hours should each type of staff be employed if the factory is to minimize
its total wage costs? Use graphical Method.
7. An advertising agency has available 1200 hours of copywriter time, 440 hours of
artist time and 780 hours of production staff time in the next planning period.
Preparing a magazine advertising campaign requires 80 hours of copywriter time, 20
hours of artist time and 15 hours of production time. It generates a profit for the
agency of $ 3000. Producing a television advertising campaign uses 40 hours of
copywriter time, 30 hours of artist time and 60 hours of production time. It yields a
profit to the agency of $ 6000. How many of each type of advertising campaign
should the agency undertake to produce in the planning period in order to maximize
its profit? Use Simplex Method.
8. A travel company operates 2 types of vehicle, A and B. Vehicle A can carry 40
passengers and 30 tons of luggage; vehicle B can carry 60 passengers but only 15 tons
of luggage. The travel company is contracted to carry at least 960 passengers and 360
 tons of luggage per journey. If vehicle A costs $ 1000 to operate per journey and
vehicle B costs $1200 to operate per journey, what combination of vehicles of type A
and B will minimize the total cost per journey? Use the Graphical Method.
9. A firm makes two products A and B and the contribution to profit is $2 per unit of
A and $3 per unit of B. There are three stages in the production process: cleaning,
mixing and tinning. The number of hours of each process required for each product
and the total number of hours available for each process are given in the table below:

Hours of
Cleaning Mixing Tinning
1 unit of A requires 3 6 2
1 unit of B requires 6 2 1.5
1 unit of C requires 210 120 60

Given these conditions, what combination of A and B should the firm produce to maximize
profit? Use (i) Graphical Method (ii) Simplex Method.

10. The point (x, 3) satisfies the inequality -5x-2y<= 13. Find the smallest possible value
of x.
11. Show that more than 1 solution exists if one tries to maximize the objective function (
Graphical Method):

Z= 4A+ 4B

Subject to the Constraints

20A + 20B <= 60

20A + 80 <= 120
A>=0 and B>=0
12. Find the minimum value of the function C = 40A + 20B subject to the constraints

10A + 40B >= 40

30A + 20B>= 60
10A>=10
A>= 0
B>=0
Solve using the graphical Method.

13. Solve the following linear programming problems using the graphical Method.
a) Maximise 2x +3y

Subject to

2x+y <= 8
x+y <=6
x+2y<= 10
x>=0 and y>=0
b) Minimise 6x+2y

Subject to
x- y>=0
3x + y>=8
x>=0
y>=0
c) Maximise 4x+ 2y

Subject to

1x + y <= 10
2x +4y <= 24
1y<= 5
X,y >=0

14. A manufacturer produces two products, namely product A with a profit of $3 per unit
and product B with a profit of $2 per unit. The following constraints apply in respect
of the production of the two products.

Availability of Utilisation per unit Utilisation per unit

production resource Product A Product B
Raw Material 1200kg 3kg 4kg
Machine Capacity 600 hours 2 hours 1 hour
 a) Formulate a linear programming model to determine the optimum production mix
with a view to maximise profit.
b) Give a full graphic representation of the problem
c) Determine how many units of product A and how many units of product B should be
manufactured in order to maximise profits by using the corner point method
d) Prove that your answer is correct by solving the equations for the constraints using the
Gaussian algorithm.
15. A company that sells cars has 3 plants, plant 1, plant 2 and plant 3; and two major
distribution centres, Centre 1 and Centre 2. The capacities of the 3 plants during the
next quarter are 1000, 1500 and 1200 cars. The quarterly demands at the two
distribution centres are 2300 and 1400 cars respectively. The shipping costs between
the plants and the distribution centres are shown in the table below.

Centre 1 Centre 2
Plant 1 $80 $215
Plant 2 $100 $108
Plant 3 $102 $68
a) Formulate an appropriate Linear programming model that seeks to minimize shipping
costs
b) Use the Least cost method to obtain the optimal solution to the problem
c) Compute the associated total shipping costs from the Least cost solution and interpret
the results
d) Use the North West Corner method and compare your results with those in (C).
16. A company manufactures 2 products on 3 sequential processes. The company
operates 10 hours per day on each process. The following table summarises the data
of the problem:

Minutes per Unit

Product Process 1 Process 2 Process 3 Unit Profit
1 10 6 8 $2
2 5 20 10 $3

a) Formulate the appropriate Linear programming model that maximizes profit

 b) Solve the Linear programming problem using (i) the graphical approach (ii) the
simplex method.
c) Interpret your solutions.
17. Given the following transportation problem having the following costs, origin
availabilities and destination requirements

Destination Origin
Origin D1 D2 D3 D4 D5 Availability
O1 3 4 3 6 7 50
O2 3 3 2 1 4 70
O3 6 5 7 11 8 95
O4 6 4 10 6 7 25
Destination 25 50 40 25 100
Requirement

Solve the problem:

a) Construct a network representation for this problem, clearly indicating supply and
demand at each node
b) Using the North West corner method to obtain an initial feasible solution
c) Using the Least cost method to obtain the optimal solution
d) Compare your answers for (a) and (b).
18. Metro water District is an agency that administers water distribution in a large
geographical area. There are two sources to supply three destinations. The Shipping
costs, total supplies from the sources and total demands from the destinations are
given in the following table:

Demand Total Supply

Source 1 2 3
1 $16 $13 $22 80
2 $14 $19 $17 70
Total 70 30 50
Demand
 a) Construct a network representation for this problem, clearly indicating supply and
demand at each node
b) Formulate the appropriate L.P model
c) Use the Least Cost method to find the solution to the problem
d) Use the North west corner method to obtain the optimal solution
e) Comment on your results
19. A concrete company transports concrete from two plants, Plant 1 and Plant 2, to three
construction sites, Site A, B, C, the plants are able to supply the following numbers of
tonnes per week and the requirements of the sites in tonnes per week are also given.
The table also shows the costs of transporting from each plant to each site.

Site A Site B Site C Total Supply

Plant 1 $4 $3 $8 300
Plant 2 $7 $5 $9 300
Total Demand 190 270 140

a) Construct a network representation for this problem, clearly indicating supply and
demand at each node
b) Formulate the Linear Programming problem that seeks to minimize shopping costs
c) Solve the problem using, (i) the Least Cost Method and (ii) the North- West Corner
Method.
20. Computers Unlimited sells micro- computers to universities and colleges in
Zimbabwe and ships them from 3 distribution warehouses. The firm is able to supply
the following numbers of microcomputers to the universities at the beginning of the
academic year.

Distribution Warehouse Supply ( Microcomputers)

1. Bulawayo 420
2. Mutare 340
3. Harare 610
Total 1370
Four Universities have ordered microcomputers that must be delivered and installed at the
beginning of the academic year
University Demand ( Microcomputers)
A. NUST 520
B. MSU 250
C. UZ 400
D. LSU 200
Total 1370

The shipping and installation costs per microcomputer from each distributor to each
university are as follows:

To
From A B C D
1 $ 22 $ 17 $ 30 $ 18
2 $ 15 $ 35 $ 20 $ 25
3 $ 28 $ 21 $ 16 $ 14

a) Formulate the appropriate Linear programming problem

b) Find the initial solution using the North- West Corner method and compute the
associated cost.
c) Find the solution using the Least Cost method and compute the associated cost.

21. Solve the following linear programming model by means of the simplex method.
Show that x1=x2=x3= 0 and x4= 18

Max Z = 4x1 +5x2 + 2x3+3x4

Subject to

5x1+4x2+7x3+x4 <= 36

2x1+6x2+3x3+x4 <= 18

x1, x2, x3, x4 >= 0

22. The following 5 inequalities define a feasible region. Which one of these could be
removed from the list without changing the region?
a) –x+y <= 10
b) X+y <= 20
c) X- 2y>= -8
d) X>=0
e) Y>=0