EXERCISE 5

OPTIMIZATION

1. The following information summarizes the operation of Mr. Euler’s newly operated
detergent factory in one week. Mr. Euler produces two types of detergents, Dynamy and
Breezy. Detergent surfactants are made from a variety of petrochemicals (derived from
petroleum) and/or oleo chemicals (derived from fats and oils). There are two main surfactants
used to produce the detergents which are Linear Alkylbenzene Sulphonic Acid (LABSA)
and Linear Alkene Benzene Sulphonate (LABS).
Mr. Euler only employs 10 workers covering a total of 40 hours a week. Since Mr. Euler’s
factory is new, he has a limited capital. He can only purchase 663 bags of surfactants. Due to
that, he decided to limit the purchase of LABS to 103 bags because the price for one bag of
LABS is very expensive compared to a bag of LABSA.
In terms of production, for 1 unit of Dynamy, the workers require 3 bags of LABS and 10
bags of LABSA, while for 1 unit of Breezy, they require 1 bag of LABS and 12 bags of
LABSA. The workers spend half an hour to produce 1 unit of Dynamy and 15 minutes for 1
unit of Breezy.
The factory is big so Mr. Euler does not have any problems in storing any numbers of
detergents that the factory produces.
Mr. Euler is selling one unit of Dynamy at RM78 and RM87 for a unit of Breezy. Every
week, from the money that Mr. Euler gets from the detergent sales, he has to pay a total cost
of RM 700.
Use the Simplex Method to calculate for the number of Dynamy and Breezy that Mr. Euler
should produce in order to gain a maximum weekly net profit.
2. The Ecogreen Hill Township is a newly developed gated and guarded residential area
conceptualized based on the criteria set by Malaysia Green Tech Financing Scheme (GTFS).
One of the main criteria of GTFS is to ensure sustainable site planning and management, in
which the developer of the township is required to restore damaged area to provide habitat
and promote biodiversity.
To fulfil this criterion, the developer of the Ecogreen Hill Township has proposed to plant
different species of trees along the communal areas within the township. These species of
trees – Gmelina Arborea, Acacia Mangium, and Dalbergia Latifolia – requires different land
size, person-hour in planting and capital costs, which are summarised in Table 1.

Table 1

Gmelina Arborea Acacia Mangium Dalbergia Latifolia

Land size (hectare) 0.1 0.2 0.15
Person-hour in planting (hr) 4 3.5 3
Capital costs (RM ‘000) 3 4 2

The total communal area available for the township is 20 hectare, while the developer has
planned to employ five workers who would work 8 hours a day for a duration of 25 days of
the planting project. The total capital costs allocated for the trees alone are RM 450,000.

(a) As the project manager of this planting project, you are required to determine the best
combination of the species of tree such that maximum number of trees could be
planted if only one type of tree can be planted at one time.
[16 marks]

(b) The developer has later proposed to shorten the project period from 25 days to 20
days so that the workers could be re-allocated to another project. Based on your
results in part (a), how would this proposal affect the project outcomes? Explain your
answers.
[4 marks]