Models and Operational Research Notes

BA ZC412:
MODELS & APP IN OPERATIONS

RESEARCH
BITS Pilani RAKHEE
Department of Mathematics
Pilani|Dubai|Goa|Hyderabad
1
BITS Pilani
Contact Session 1
Introduction to Linear Programming
2
Text Book
David R Anderson, Dennis J

Sweeney, Thomas A
Williams, Jeffrey D Camm
and Kipp Martin.
Quantitative Methods for
Business. Twelfth edition.
Cengage Learning. 2013.
20-07-2019 BA ZC412 Rakhee BITS Pilani, Deemed to be University under Section 3 of UGC Act, 1956
Course Highlights
Impart a conceptual understanding of

• Mathematical modelling techniques
• Applied to simple business problems
Focus on
• Problem formulation
• Solution technique
• Solution interpretation
Using Excel to solve OR problem

4
Course Coverage
Topic Chapter
Linear Programming 7,8, 9, 10, 12
Integer Programming 11
Waiting Line Models 15
Inventory Models 14
Simulation 16
Markov Process 17
Decision Analysis 4
Utility and Game 5
Introduction to forecasting 6
Chapter no 2, 3 and 13 are not in syllabus. 5
Teaching Methodology
Through problem solving

Please read the chapter before coming to class.
Concept will be explained by simple examples.
Practice problem will be assigned.
Evaluation Scheme:
No Name Type Durati Weight Day, Date, Session, Time

on
EC-1 Quiz-I Online - 5% August 23 – September 01,
2019
Quiz-II 5% September 27 – October 6,
2019
Experiential 15% November 01 – 10, 2019
Learning
EC-2 Mid-Semester Closed 2 30% Saturday, 21/09/2019 (FN)
Test Book hours 10 AM – 12 Noon
EC-3 Comprehensive Open 3 45% Saturday, 16/11/2019 (FN)
Exam Book hours 9 AM – 12 Noon 7
Important links and information
Elearn portal: https://elearn.bits-pilani.ac.in
Students are expected to visit the Elearn portal on a regular
basis and stay up to date with the latest announcements and
deadlines.
Contact sessions: Students should attend the online lectures as
per the schedule provided on the Elearn portal.
If a student is unable to appear for the Regular Test/Exam due to

genuine exigencies, the student should follow the procedure to
apply for the Make-Up Test/Exam which will be made available
on the Elearn portal. The Make-Up Test/Exam will be conducted
only at selected exam centres on the dates to be announced
later.
8
Introduction to Linear Programming
A Simple Maximization Problem
Product Mix Problem

We produce two products: A fuel additive and a solvent base.
3 raw materials are required:

• 1 Kg of fuel additive requires 1 Kg of material1, 2 Kg of material2 and 1 Kg
of material3
• 1 Kg of the solvent base requires 0 Kg of material1, 3 Kg of material2 and 1
Kg of material3
There are 6 Kg of material1, 19 Kg of material2 and 8 Kg of material3.

Profit contributions are Rs5/Kg on Product 1 and Rs7/Kg on Product 2.
We want to maximize the profit
A Simple Maximization Problem
Product Mix Problem Formulation

We produce two products:
Decision Variables
A fuel additive and a solvent base.
x1: Amount (Kgs) of fuel additive produced
x2: Amount (Kgs) of solvent base produced
Maximize the profits when the profit
contributions are Rs5/Kg on Product 1
and Rs7/Kg on Product 2. Max 5x1 + 7x2 Objective Function
Subject to
3 raw materials are reqd.
• 1 Kg of fuel additive requires 1 Kg of x1 < 6 (Material 1)
material1, 2 Kg of material2 and 1 Kg of 2x1 + 3x2 < 19 (Material 2)
material 3.
• While 1 Kg of the solvent base requires x1 + x2 < 8 (Material 3)
0, 3 and 1 Kg respectively.
• There are 6 Kg of material1, 19 Kg of
material2 and 8 Kg of material3. x1 > 0 and x2 > 0 (Non-Negativity)
Linear Programming (LP) Problem
If both the objective function and the constraints are linear,

the problem is referred to as a linear programming
problem.
Linear functions are functions in which each variable

appears in a separate term raised to the first power and is
multiplied by a constant (which could be 0).
Linear constraints are linear functions that are restricted to

be "less than or equal to", "equal to", or "greater than or
equal to" a constant.
Linear Programming
• Linear programming has nothing to do with computer

programming.
• The use of the word “programming” here means
“choosing a course of action.”
• Linear programming involves choosing a course of
action when the mathematical model of the problem
contains only linear functions.
Linear Programming (LP) Problem
The maximization or minimization of some quantity is the
objective in all linear programming problems.
All LP problems have constraints that limit the degree to

which the objective can be pursued.
A feasible solution satisfies all the problem's constraints.
An optimal solution is a feasible solution that results in the

largest possible objective function value when
maximizing (or smallest when minimizing).
Problem Formulation
Problem formulation or modeling is the process of

translating a verbal statement of a problem into a
mathematical statement.
Formulating models is an art that can only be mastered

with practice and experience.
Every LP problems has some unique features, but most

problems also have common features.
Guidelines for Model Formulation
Understand the problem thoroughly.
Describe the objective.
Describe each constraint.
Define the decision variables.
Write the objective in terms of the decision variables.
Write the constraints in terms of the decision variables.
Example
A furniture makers produces desks, chairs and
racks. He has 100 sq ft of wood available.
Desk requires 0.8 sq ft
Chair requires 0.4 sq ft
Rack requires 0.5 sq ft
650 man-hours are available.
Desk requires 5 hrs.
Chairs requires 3 hours
Rack requires 3 hours
Capacity of storing is 1260 sq ft.
Area required by desk 9 sq. ft.
Area requires by chair 6 sq ft.
Area requires by rack 9 sq ft.
Market profit – value of
Desk of Rs. 20, Chair of Rs. 11, Rack of Rs. 15
Determine how many desks, chairs and racks should be made to
maximize the profit.
Solution
Objective : To maximize the profit

Decision variables : x1 = # of desks to be
made
x2 = # of chairs to be made
x3 = # of racks to be made
Objective function Z = 20x1 + 11 x2 + 15 x3
So, Maximize Z = 20x1 + 11x2 + 15x3
Constraint 1: Available Wood 100 sq.ft.
Constraint 2: Available man hours 650.
Constraint 3: Storing capacity 1260 sq ft.
0.8 x1  0.4 x 2  0.5 x3 100
5 x1  3x 2  3x3  650
9 x1  6 x 2  9 x3 1260
Non-negative condition x1 , x2 , x3  0 and integers.
Maximize Z  20 x1  11x2  15 x3
s.t.
0.8 x1  0.4 x2  0.5 x3 100
5 x1  3x2  3x3  650
9 x1  6 x2  9 x3 1260
x1 , x2 , x3  0 and integers.
BITS Pilani
Graphical Solution
23
Product Mix Formulation
Max 5x1 + 7x2 Objective Function

s.t.
x1 < 6 Material 1
2x1 + 3x2 < 19 Material 2
x1 + x2 < 8 Material 3
x1 > 0 and x2 > 0 Non-Negativity
First Constraint Graphed
x2
Max 5x1 + 7x2

8
7 x1 = 6
6 s.t. x1 < 6
Shaded region
5 contains all 2x1 + 3x2 < 19
4 feasible points x1 + x2 < 8
for this constraint
3
2 (6, 0) x1 > 0 and x2 > 0
1
x1
1 2 3 4 5 6 7 8 9 10
Second Constraint
Graphed
x2
8 (0, 6 1/3)
Max 5x1 + 7x2
7
6 s.t. x1 < 6
2x1 + 3x2 = 19
5 2x1 + 3x2 < 19
4 x1 + x2 < 8
Shaded
3
region contains
2 all feasible points (9 1/2, 0)
for this constraint
x1 > 0 and x2 > 0
1
x1
1 2 3 4 5 6 7 8 9 10
Third Constraint Graphed
x2
(0, 8)
Max 5x1 + 7x2
8
7
6 x1 + x 2 = 8 s.t. x1 < 6
5 2x1 + 3x2 < 19
4 x1 + x2 < 8
Shaded
3
region contains
2 all feasible points x1 > 0 and x2 > 0
for this constraint (8, 0)
1
x1
1 2 3 4 5 6 7 8 9 10
Combined-Constraint Graph Showing Feasible Region
x2
x1 + x2 = 8
8 Max 5x1 + 7x2
7
x x1 = 6
6 s.t. x1 < 6
5 2x1 + 3x2 < 19
4
x x1 + x2 < 8
3
Feasible 2x1 + 3x2 = 19
2 Region x
x1 > 0 and x2 > 0
1
x1
x x
1 2 3 4 5 6 7 8 9 10
Objective Function Line: 5x1 + 7x2 = 35
x2
Max 5x1 + 7x2
8
7
(0, 5)
6 5x1 + 7x2 = 35
5
s.t. x1 < 6
4 2x1 + 3x2 < 19
3 x1 + x2 < 8
2
(7, 0)
1 x1 > 0 and x2 > 0
x1
1 2 3 4 5 6 7 8 9 10
Selected Objective Function Lines
x2
8 8
7 7
(0, 5) 5x1 + 7x2 = 35
6 5x1 + 7x2 = 35 6
5 5 5x1 + 7x2 = 39
4 4
3 3 5x1 + 7x2 = 42
2 2
(7, 0)
1 1
x1
1 2 3 4 5 6 7 8 9 10 1 2 3 4 5 6 7 8 9 10
Optimal Solution
x2
Maximum
Objective Function Line
8 5x1 + 7x2 = 46
7
x
Max 5x1 + 7x2
Optimal Solution
6
(x1 = 5, x2 = 3) s.t. x1 < 6
5
4 2x1 + 3x2 < 19
x
3 x1 + x2 < 8
2 x x1 > 0 and x2 >0
1
x1
x x
1 2 3 4 5 6 7 8 9 10
Extreme Points and the Optimal
Solution
The corners or vertices of the feasible region are referred to as
the extreme points.
An optimal solution to an LP problem can be found at an

extreme point of the feasible region.
When looking for the optimal solution, you do not have to

evaluate all feasible solution points.
You have to consider only the extreme points of the feasible

region.
Binding constraint: LHS = RHS

Non-binding constraint: LHS ≠ RHS
Identifying the Extreme Points
Optimal Solution Max 5x1 + 7x2

x2 (x1 = 5, x2 = 3)
s.t. x1 < 6
8 2x1 + 3x2 < 19
7 5 (0, 6 1/3)
x1 + x2 < 8
6 x1 > 0 and x2 >0
5
4 Extreme Point Z
4 (5, 3)
3 1 0
Feasible
3 (6, 2)
2 Region 2 30
1 3 44
(0, 0) 2 (6, 0)
x1 4 46
1
1 2 3 4 5 6 7 8 9 10 5 44.33
Optimal Solution Max 5x1 + 7x2
x2
s.t. x1 < 6
8 2x1 + 3x2 < 19
7
x x1 + x2 < 8
6 Optimal Solution
(x1 = 5, x2 = 3) x1 > 0 and x2 >0
5
4 x
3
What are the binding constraints?
2
Constraints 2 and 3
x
Any non-binding constraint?
1
x1
Constraint 1
x x
1 2 3 4 5 6 7 8 9 10
A Simple Minimization Problem
Min 5x1 + 2x2

s.t.
2x1 + 5x2 > 10
4x1 - x2 > 12
x1 + x2 > 4
x1, x2 > 0
The Feasible Region
x2
6
Min 5x1 + 2x2 Feasible Region
5
4x1 - x2 > 12
s.t. 2x1 + 5x2 > 10 4
4x1 - x2 > 12 3
x1 + x2 > 4
x1 + x2 > 4
2 2x1 + 5x2 > 10
x1, x2 > 0 1
x1
1 2 3 4 5 6
Objective Function Graphed
Min 5x1 + 2x2 x2

5x1 + 2x2 = 20
s.t. 2x1 + 5x2 > 10 6
4x1 - x2 > 12
5
x1 + x2 > 4 4x1 - x2 > 12
x1, x2 > 0 4
x1 + x2 > 4
Should the objective fn move left or right?
3
Left!
2 2x1 + 5x2 > 10
Solve the two equations
x1 = 16/5, x2 = 4/5 1
x1
1 2 3 4 5 6
Optimal Solution
x2
6
4x1 - x2 > 12
5
x1 + x2 > 4
4
Optimal Solution:
3
x1 = 16/5, x2 = 4/5,
2 5x1 + 2x2 = 17.6
1 2x1 + 5x2 > 10

x1
1 2 3 4 5 6
Binding Constraint
What are the binding constraints?

Non-Binding Constraints?
x2
6
4x1 - x2 > 12
5
x1 + x2 > 4
4
Optimal Solution:
3 x1 = 16/5, x2 = 4/5,
5x1 + 2x2 = 17.6
2
2x1 + 5x2 > 10
1
x1
1 2 3 4 5 6

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BA ZC412:

MODELS & APP IN OPERATIONS

David R Anderson, Dennis J

Impart a conceptual understanding of

Using Excel to solve OR problem

Through problem solving

No Name Type Durati Weight Day, Date, Session, Time

If a student is unable to appear for the Regular Test/Exam due to

Product Mix Problem

3 raw materials are required:

There are 6 Kg of material1, 19 Kg of material2 and 8 Kg of material3.

Product Mix Problem Formulation

If both the objective function and the constraints are linear,

Linear functions are functions in which each variable

Linear constraints are linear functions that are restricted to

• Linear programming has nothing to do with computer

All LP problems have constraints that limit the degree to

A feasible solution satisfies all the problem's constraints.

An optimal solution is a feasible solution that results in the

Problem formulation or modeling is the process of

Formulating models is an art that can only be mastered

Every LP problems has some unique features, but most

Objective : To maximize the profit

Max 5x1 + 7x2 Objective Function

Max 5x1 + 7x2

An optimal solution to an LP problem can be found at an

When looking for the optimal solution, you do not have to

You have to consider only the extreme points of the feasible

Binding constraint: LHS = RHS

Optimal Solution Max 5x1 + 7x2

Min 5x1 + 2x2

Min 5x1 + 2x2 x2

1 2x1 + 5x2 > 10

What are the binding constraints?

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