BSBI524 QUANTITATIVE METHODS 1

Module 4. MODELING WITH LINEAR PROGRAMMING

– MINIMIZATION

Module 4. MODELING WITH LINEAR PROGRAMMING –

MINIMIZATION
Week No : 4 and 5
Duration : 3 hrs

In the previous module, we used covered the basics assumptions, characteristics and
steps associated to Linear Programming (LP) and used a business based problem to apply
the said concepts in maximization problems. As we have mentioned last time, LP is one of
the models used by managers to arrive at a ‘best’ solution.

Many LP problems involve minimizing an objective such as cost instead of

maximizing a profit function. A restaurant, for example, may wish to develop a work
schedule to meet staffing needs while minimizing the total number of employees. A
manufacturer may seek to distribute its products from several factories to its many regional
warehouses in such a way as to
minimize total shipping costs. A hospital
may want to provide a daily meal plan
for its patients that meet certain
nutritional standards while minimizing
food purchase costs. This module will
cover the basic concepts of LP as direct
application for minimization objectives.
At the end of the end of this module, the
learners are expected to;

C2. Define and identify appropriate quantitative tools and techniques in solving
business related problems;

Course Module – BSBI524 Quantitative Method By: MPDoblas

 C4. Solve problems using appropriate quantitative tools and techniques related to
business situations;

C6. Conduct linear programming and decision analysis and critically evaluate
inferences on applied quantitative models;

TOPIC 1. MINIMIZATION PROBLEM

The solution process for minimization problems is

Hint Box identical to maximization except for the direction
Minimization problems are that we push the objective function line. A
usually associated with costs.
minimization line is seeking to get as close as
Major cost of business includes
transportation and raw possible to the origin (rather than as far away as
materials. Thus, you will often
possible). Typically, the feasible area will prevent
see diet problems and fertilizer
mixing as one of the most a minimization line from actually reaching the
common application of
origin but the point the line intersects last as it
minimization in LP.
approaches the origin will be the minimization
solution.

Thus, minimization problems can be solved graphically by first setting up the feasible
solution region and then using corner point method (which is analogous to the maximization
problems) to find the values of the decision variables that yield the minimum cost. Let’s
have a direct example using Saudia Turkey Corporation.

EXAMPLE: The Saudia Turkey Corporation is considering buying two different brands of
turkey feed and blending them to provide a good, low-cost diet for its turkeys. Each feed
contains, in varying proportions, some or all of the three nutritional ingredients essential for
fattening turkeys. Each pound of brand 1 purchased, for example, contains 5 ounces of
ingredient A, 4 ounces of ingredient B, and 0.5 ounce of ingredient C. Each pound of brand 2
contains 10 ounces of ingredient A, 3 ounces of ingredient B, but no ingredient C. The brand 1
feed costs the ranch 2 cents a pound, while the brand 2 feed costs 3 cents a pound. The
minimum monthly requirement for each ingredient is 90, 48 and 1.5 pounds for ingredient A,
B and C respectively. The owner of the ranch would like to use LP to determine the lowest-
 BSBI524 QUANTITATIVE METHODS 3
Module 4. MODELING WITH LINEAR PROGRAMMING
– MINIMIZATION

cost diet that meets the minimum monthly intake requirement for each nutritional
ingredient.

Stage 1: Formulation

Similar to the maximization problem, we will be using the following steps in the formulation
process;

1. Identify if it’s a minimization or maximization problem.

2. Identify the controllable (decision variables) and the uncontrollable values
(parameter)
3. Create the objective function
4. Create the constraints

Step 1: Identify if it’s a minimization or maximization problem

In the provided example, it is clear that it is a minimization problem. One hint is that
the problem provided cost per unit instead of profit per unit.

Step 2: Identify the controllable (decision variables) and the uncontrollable values (parameter)

In this step, it is advised that you first identify write down first all constants (fixed
values) and label them properly. In most cases, there would be two or more product mixes to
produce (example: product A and product B or bread and biscuit) or two or more production
components to mix (example: wood and metal, flour and salt). It is suggested that you
denote them with X and Y for easier plotting in the Cartesian coordinate plane in the next
stage. Regardless of the assignment (X or Y), what is important is the consistency in labeling.
Using the example from Saudia Turkey Corporation, we have the following;

Brands of Turkey Feed : Brand 1 and Brand 2

We will denote X = Brand 1 and Y = Brand 2

Course Module – BSBI524 Quantitative Method By: MPDoblas

Controllable values (decision variables) = quantity of X to be purchased
quantity of Y to be purchased

Uncontrollable values (parameters) = 5 ounces of ingredient A from a pound of X

4 ounces of ingredient B from a pound of X
0.5 ounces of ingredient C from a pound of X
10 ounces of ingredient A from a pound of Y
3 ounces of ingredient B from a pound of Y
0 ounces of ingredient C from a pound of Y
90 minimum requirements for ingredient A (lbs)
48 minimum requirements for ingredient B (lbs)
1.5 minimum requirements for ingredient C (lbs)
2 cost of Brand X/pound (cents)
3 cost of Brand Y/pound (cents)
Step 3: Create the objective function

After identifying the parameters and decision variables, it is time to convert them into
their mathematical form. Recall that in step 1 we identified that the sample problem is a
minimization problem, thus it would be correct to write “minimize” as the label for the
objective function. The values identified in step two are also reiterated below so you can see
how the mathematical statement is mapped from its descriptive form in derived in step 2.

Controllable values (decision variables) = quantity of X (Brand 1)

Uncontrollable values (parameters)
quantity of Y (Brand 2)
= 5 ounces of ingredient A from a pound of X
4 ounces of ingredient B from a pound of X
0.5 ounces of ingredient C from a pound of X
10 ounces of ingredient A from a pound of Y
3 ounces of ingredient B from a pound of Y
0 ounces of ingredient C from a pound of Y
90 minimum requirements for ingredient A (lbs)
48 minimum requirements for ingredient B (lbs)
1.5 minimum requirements for ingredient C (lbs)
2 cost of Brand X/pound (cents)
3 cost of Brand Y/pound (cents)

Minimize 2X +3Y
 BSBI524 QUANTITATIVE METHODS 5
Module 4. MODELING WITH LINEAR PROGRAMMING
– MINIMIZATION

Step 4: Create the constraints

Once done with the first part of the mathematical model (objective function), the next
step is to create the second part of the mathematical model - the constraints. Again, the
identified in step two are also reiterated below so you can see how the mathematical
statement is mapped from its descriptive form.

Controllable values (decision variables) = quantity of X (Brand 1)

quantity of Y (Brand 2)
Uncontrollable values (parameters) = 5 ounces of ingredient A from a pound of X
4 ounces of ingredient B from a pound of X
0.5 ounces of ingredient C from a pound of X
10 ounces of ingredient A from a pound of Y
3 ounces of ingredient B from a pound of Y
0 ounces of ingredient C from a pound of Y
90 minimum requirements for ingredient A (lbs)
48 minimum requirements for ingredient B (lbs)
1.5 minimum requirements for ingredient C (lbs)
2 cost of Brand X/pound (cents)
3 cost of Brand Y/pound (cents)
Subject to (st):
5X +10Y ≥ 90 [ingredient A constraint]
4X + 3Y ≥ 48 [ingredient B constraint]
0.5X ≥ 1.5 [ingredient C constraint]
X, Y ≥0 [non-negativity constraint]

Note:

(1) The third constraint (0.5X ≥ 1.5) does not have a Y component since the problem
indicates 0 contribution of ingredient C from brand B (Y).
(2) The inequality symbol is “≥” since the problem requires that the mixture should
at least meet the minimum requirements for each of the ingredients.

Hint Box
There are common words or instances associated to In terms of the inequality sign (≥ or ≤). The
greater than or equal to inequality (≤) is associated to resource limitation such as limited time
and raw materials and often is used when the terms “limited to” and “available” are mentioned
in the conditions. On the other hand, (≥) is mostly associated to minimum requirements for
mixing or combining raw materials and is used when the terms “up to”, “must contain”, or “at
least” are mentioned in the problem.

Course Module – BSBI524 Quantitative Method By: MPDoblas

 To conclude the formulation stage, the complete mathematical model for the problem
is formulated as such;
Minimize 2X +3Y

Subject to (st):

5X +10Y ≥ 90
4X + 3Y ≥ 48
0.5X ≥ 1.5
X, Y ≥0

Stage 2: Solution (graphical method)

. When there are more than two variables, it is not possible to plot the solution on a
two-dimensional graph and we must turn to more complex approaches. Stage 2 has the
following steps;

1) Graph the constraints.

2) Determine the solution by identifying the extreme corners
3) Use the objective function to find the optimal solution

Step 1: Graph the constraints

Similar to maximization problems, we are ready to plot the identified constraints.

5X +10Y ≥ 90
4X + 3Y ≥ 48
0.5 X ≥ 1.5
X, Y ≥0

First, we have to identify the points at which the line crosses both the horizontal and
vertical axes. To do so, we will convert the inequality to an equation. Thus, 5X +10Y ≥ 90
becomes;
5X +10Y = 90

To find the Y intercept, let X = 0 ;

5(0) + 10Y = 90
10Y = 90
10
 BSBI524 QUANTITATIVE METHODS 7
Module 4. MODELING WITH LINEAR PROGRAMMING
– MINIMIZATION

Y = 9 thus, the Y intercept is (0 , 24)

To find the X intercept, let Y = 0 ;

5X + 10(0) = 90
5X = 90
5
X = 18 thus, the Y intercept is (18 , 0)

Doing the same for the remaining constraints;

Ineq.2 4X + 3Y = 48
Y intercept 4(0) + 3Y = 48
3Y = 48
3
Y = 16

Ineq.2 4X + 3Y = 48
X intercept 4X +3(0) = 48
4X = 48
4
X = 12

Ineq.3 0.5 X = 1.5 Since Ineq.3 does not have a Y

X intercept 0.5 X = 1.5 coordinate, then its Y intercept
0.5 is equal to 0.
X=3

In summary, we have the following constraints to plot;

Inequality X Y
5X +;:Y ≥ 9: 18 9
4X + 3Y ≥ 48 12 16
:.5 X ≥ ;.5 3 0

Course Module – BSBI524 Quantitative Method By: MPDoblas

 Plotting the constraints altogether;

Step 2: Determine the solution by identifying the extreme corners

 BSBI524 QUANTITATIVE METHODS 9
Module 4. MODELING WITH LINEAR PROGRAMMING
– MINIMIZATION

Important Notes in Step 2

Shading Direction
If inequality is ≥ shading starts from the linear inequality going upwards
If inequality is ≤ shading starts from the linear inequality going downward

Non – negativity constraint

Notice that we are only looking at the first quadrant of the cartesian plane (where
both x and y coordinates are positive). This is to comply with the non-negativity constraint X
+ Y ≥ 0 suggesting that the optimal solution for both X and Y should be positive values only.

Feasible Region
The feasble region is the area in the cartesian plane where the shaded region of both
constraints meet.

Extreme Corners
The corner points within and on the boundary of the feasible region are the possible
optimal solution for both X and Y. In this example, we have three corner points lables 1,2,
and 3. Notice that among all corners only corner 3 is the easiest to spot since it lies within
the x axis. Thus;

Vertex/Corner Coordinate (X,Y)

3 (18,0)
1 ?
2 ?

It is howvever, relatively difficult to eyeball the coordinates for vertex 1 and 2. Thus,
to be sure, we can algebraicly derrive the value of X and Y for the vertexes using either the
process of subsititution or eliminination. Both method will result to the same value.

Before performing either elimination or substitution, it is important for us to

properly identify the lines that resulted to the identified corners of interest. By inspection
notice that corner 1 is an apex of the line that represents Inequality 3 and 2 while corner 2 is

Course Module – BSBI524 Quantitative Method By: MPDoblas

a result of the intersection between Inequality 2 and 1. The table summarizes the mentioned
observation.
Vertex/Corner Intersection Inequality
of?
1 Ineq.3 :.5 X ≥ ;.5
Ineq.2 4X + 3Y ≥ 48
2 Ineq.1 5X +;:Y ≥ 9:
Ineq.2 4X + 3Y ≥ 48

Therefore, to solve the coordinates for each of the vertex, the identified pair of
inequalities shall be used.

Solving Corner 1 coordinates Using Elimination

(remember to convert the inequalities to equality)

Eq. 3 0.5X + = 1.5

Eq. 2 4.0X + 3Y = 48.0
(the goals is to eliminate either X or Y by way of subtraction)

To do so, we multiply Eq.3 by 8 on both sides so we can cancel X

(8) 0.5X + = 1.5 (8)

4.0X +3Y = 48.0

thus;
4X + = 12
4X + 3Y = 48
-3Y= - 36
-3
Y= 12

Substitute the derived value of Y in either eq.3 or eq.2. Arbitrarily, we will use Eq.2, thus;

4X+ 3(12) = 48
4X + 36 = 48
4X = 48 – 36
4X = 12
4
X=3

Thus for vertex 1, the coordinates are (3, 12).

 BSBI524 QUANTITATIVE METHODS 11
Module 4. MODELING WITH LINEAR PROGRAMMING
– MINIMIZATION

Solving Corner 2 coordinates Using Substitution

Eq. 1 5X +10Y = 90
Eq. 2 4X + 3Y = 48

The method requires to assume isolate either X or Y using either equation 1 or 2. For
example, using eq.2 we derive the initial value of Y as;

4X + 3Y = 48
3Y = 48 – 4X
Y = 48 – 4X
3

Substitute the derived value of Y in Eq.1;

5X + 10Y = 90
5X + (10) x = 90

5X + 480 – 40 X = 90
3

(3) 5X + 480 – 40 X = 90 (3)

3
15X + 480 – 40X = 270 (combine like terms)
15X - 40X = 270 – 480
-25X = – 210
-25
X = 8.4

Substitute the derived value of X in either Eq.1 or Eq.2. Arbitrarily we will use Eq.2;

4X + 3Y = 48
4(8.4) + 3Y = 48
33.6 + 3Y = 48
3Y = 48 - 33.6 (combining like terms)
3Y = 14.4
3
Y = 4.8

Thus for vertex 1, the coordinates are (8.4, 4.8).

Course Module – BSBI524 Quantitative Method By: MPDoblas

In summary we have the following corner points and their corresponding coordinates;

Vertex/Corner Coordinate (X,Y)

3 (18,0)
1 (3,12)
2 (8.4,4.8)

Step 3. Use the objective function to find the optimal solution

The final step in the solution stage is to find the optimal solution using the
determined objective function. Recall that the identified objective function was;

Minimize 2X +3Y

We will use this objective function to check which of the corner points or vertexes
provide the optimal solution.

Vertex/Corner Coordinate (X,Y) Plugging the X and Y values to cost (Output)

2X +3Y
3 (18,0) 2(18) + 3(0) 36
1 (3,12) 2(3) + 3(12) 42
2 (8.4,4.8) 2(8.4) + 3(4.8) 3.12

Considering that the model’s objective is to minimize cost (output), the vertex that
results to the minimum value of output is the optimal solution. Thus, looking at the table, the
lowest output is obtained if using vertex 2 where X = 8.4 and Y = 4.8. The results suggests
that the company can achieve the lowest-cost diet that meets the minimum monthly intake
requirement for each nutritional ingredient if they purchase 8.4 pounds of Product 1 and 4.8
pounds of Product 2.

Formative Assessment 4
Direction: In each of the items below, provide the details/data required

1. A farmer plans to mix two types of food to make a mix of low cost feed for the animals
in his farm. A bag of food A costs $10 and contains 40 units of proteins, 20 units of
minerals and 10 units of vitamins. A bag of food B costs $12 and contains 30 units of
proteins, 20 units of minerals and 30 units of vitamins. How many bags of food A and
 BSBI524 QUANTITATIVE METHODS 13
Module 4. MODELING WITH LINEAR PROGRAMMING
– MINIMIZATION

B should the consumed by the animals each day in order to meet the minimum daily
requirements of 150 units of proteins, 90 units of minerals and 60 units of vitamins at
a minimum cost?

Requirements;

C2. Define and identify appropriate quantitative tools and techniques in solving business
related problems

a) Define the problem by identifying the controllable and uncontrollable values (1 mark
each correct value)

C4. Solve problems using appropriate quantitative tools and techniques related to business
situations

b) Formulate the appropriate quantitative model for the problem (5 marks)

5 pts Complete components of the graph/mathematical model
4 pts graph/mathematical model lacks minor details/component
3 pts The graph/mathematical model lacks moderate number of components
2 pts The graph/mathematical model lacks major number of components
1 pt Only 1 component of the graph/mathematical model is appropriately identified

C6. Conduct linear programming and decision analysis and critically evaluate inferences
on applied quantitative models

c) Evaluate the model to identify the optimal solution for the given problem. (5 marks)
5 pts the explanations is correct and is done clearly with supporting calculations.
4 pts the explanation is correct but lacks calculations
3 pts the explanation is correct but not properly discussed
2 pts the explanation is poorly discussed and computations are not complete
1 pt Wrong explanation

Course Module – BSBI524 Quantitative Method By: MPDoblas

 2. A house wife wishes to mix two types of food F1 and F2 in such a way that the vitamin
contents of the mixture contain at least 8 units of vitamin A and 11 units of vitamin B.
Food F1 costs E60/Kg and Food F2 costs E80/kg. Food F1 contains 3 units/kg of
vitamin A and 5 units/kg of vitamin B while Food F2 contains 4 units/kg of vitamin A
and 2 units/kg of vitamin B. what is the mixture that minimizes the cost while
meeting the minimum requirements
Requirements;

C2. Define and identify appropriate quantitative tools and techniques in solving business
related problems

a) Define the problem by identifying the controllable and uncontrollable values (1 mark
each correct value)

C4. Solve problems using appropriate quantitative tools and techniques related to business
situations

b) Formulate the appropriate quantitative model for the problem (5 marks)

5 pts Complete components of the graph/mathematical model
4 pts graph/mathematical model lacks minor details/component
3 pts The graph/mathematical model lacks moderate number of components
2 pts The graph/mathematical model lacks major number of components
1 pt Only 1 component of the graph/mathematical model is appropriately identified

C6. Conduct linear programming and decision analysis and critically evaluate inferences
on applied quantitative models

c) Evaluate the model to identify the optimal solution for the given problem. (5 marks)
5 pts the explanations is correct and is done clearly with supporting calculations.
4 pts the explanation is correct but lacks calculations
3 pts the explanation is correct but not properly discussed
2 pts the explanation is poorly discussed and computations are not complete
1 pt Wrong explanation
 BSBI524 QUANTITATIVE METHODS 15
Module 4. MODELING WITH LINEAR PROGRAMMING
– MINIMIZATION

References and Supplementary Materials

Books and Journals
1. Render, B., Stair Jr, R. M., & Hanna, M. E. (2012). Quantitative Analysis for
Management (11th Ed.)
2. Waters, D., & Waters, C. D. J. (2017). Quantitative methods for business. Pearson
Education.
3. Wisniewski, M. (2010). Quantitative Methods for Decision Makers with Mathxl.
Pearson Education.

Course Module – BSBI524 Quantitative Method By: MPDoblas