Problem 1

Demand
1 2 3 4 5 6 7 8 9 Total
190 230 260 280 210 170 160 260 180 1940

There are 20 full time employees, each can produce 10 units per
period at the cost of $6 per unit. Therefore the supply of full time
workers is as follows
1 2 3 4 5 6 7 8 9 Total
200 200 200 200 200 200 200 200 200 1800

Overtime cost is $13 per unit.

Inventory carrying cost $5 per unit per period
Backlog cost $10 per unit per period

Maximum over time production is 20 units per period

Formulated the problem as a Linear Programming model. Using excel

and solver find the optimal solution.
Solution to Problem 2
 Changing Cells

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1
Prod_Over1
Prod_Reg2
Prod_Over2
Prod_Reg3
Prod_Over3
Prod_Reg4
Prod_Over4
Prod_Reg5
Prod_Over5
Prod_Reg6
Prod_Over6
Prod_Reg7
Prod_Over7
Prod_Reg8
Prod_Over8
Prod_Reg9
Prod_Over9
 RHS

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9 RHS
Prod_Reg1 <= 200
Prod_Over1 <= 20
Prod_Reg2 <= 200
Prod_Over2 <= 20
Prod_Reg3 <= 200
Prod_Over3 <= 20
Prod_Reg4 <= 200
Prod_Over4 <= 20
Prod_Reg5 <= 200
Prod_Over5 <= 20
Prod_Reg6 <= 200
Prod_Over6 <= 20
Prod_Reg7 <= 200
Prod_Over7 <= 20
Prod_Reg8 <= 200
Prod_Over8 <= 20
Prod_Reg9 <= 200
Prod_Over9 <= 20

= = = = = = = = =
RHS 190 230 260 280 210 170 160 260 180 0
 LHS

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1 =SUM(B 2 5 :J 2 5 )
Prod_Over1
Prod_Reg2
Prod_Over2
Prod_Reg3
Prod_Over3
Prod_Reg4
Prod_Over4
Prod_Reg5
Prod_Over5
Prod_Reg6
Prod_Over6
Prod_Reg7
Prod_Over7
Prod_Reg8
Prod_Over8
Prod_Reg9
Prod_Over9
=SUM(B25:B42)
 LHS

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9 LHS RHS
Prod_Reg1 0 <= 200
Prod_Over1 0 <= 20
Prod_Reg2 0 <= 200
Prod_Over2 0 <= 20
Prod_Reg3 0 <= 200
Prod_Over3 0 <= 20
Prod_Reg4 0 <= 200
Prod_Over4 0 <= 20
Prod_Reg5 0 <= 200
Prod_Over5 0 <= 20
Prod_Reg6 0 <= 200
Prod_Over6 0 <= 20
Prod_Reg7 0 <= 200
Prod_Over7 0 <= 20
Prod_Reg8 0 <= 200
Prod_Over8 0 <= 20
Prod_Reg9 0 <= 200
Prod_Over9 0 <= 20
LHS 0 0 0 0 0 0 0 0 0
= = = = = = = = =
RHS 190 230 260 280 210 170 160 260 180
 Cost Table; Format

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1
Prod_Over1
Prod_Reg2
Prod_Over2
Prod_Reg3
Prod_Over3
Prod_Reg4
Prod_Over4
Prod_Reg5
Prod_Over5
Prod_Reg6
Prod_Over6
Prod_Reg7
Prod_Over7
Prod_Reg8
Prod_Over8
Prod_Reg9
Prod_Over9
 Production Cost; Regular, Overtime

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1 6
Prod_Over1 13
Prod_Reg2 6
Prod_Over2 13
Prod_Reg3 6
Prod_Over3 13
Prod_Reg4 6
Prod_Over4 13
Prod_Reg5 6
Prod_Over5 13
Prod_Reg6 6
Prod_Over6 13
Prod_Reg7 6
Prod_Over7 13
Prod_Reg8 6
Prod_Over8 13
Prod_Reg9 6
Prod_Over9 13
 Inventory Cost

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1 6 11 16 21 26 31 36 41 46
Prod_Over1 13 18 23 28 33 38 43 48 53
Prod_Reg2 6
Prod_Over2 13
Prod_Reg3 6
Prod_Over3 13
Prod_Reg4 6
Prod_Over4 13
Prod_Reg5 6
Prod_Over5 13
Prod_Reg6 6
Prod_Over6 13
Prod_Reg7 6
Prod_Over7 13
Prod_Reg8 6
Prod_Over8 13
Prod_Reg9 6
Prod_Over9 13
 Inventory Cost for All Periods

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1 6 11 16 21 26 31 36 41 46
Prod_Over1 13 18 23 28 33 38 43 48 53
Prod_Reg2 6 11 16 21 26 31 36 41
Prod_Over2 13 18 23 28 33 38 43 48
Prod_Reg3 6 11 16 21 26 31 36
Prod_Over3 13 18 23 28 33 38 43
Prod_Reg4 6 11 16 21 26 31
Prod_Over4 13 18 23 28 33 38
Prod_Reg5 6 11 16 21 26
Prod_Over5 13 18 23 28 33
Prod_Reg6 6 11 16 21
Prod_Over6 13 18 23 28
Prod_Reg7 6 11 16
Prod_Over7 13 18 23
Prod_Reg8 6 11
Prod_Over8 13 18
Prod_Reg9 6
Prod_Over9 13
 Backlog Cost

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1 6 11 16 21 26 31 36 41 46
Prod_Over1 13 18 23 28 33 38 43 48 53
Prod_Reg2 6 11 16 21 26 31 36 41
Prod_Over2 13 18 23 28 33 38 43 48
Prod_Reg3 6 11 16 21 26 31 36
Prod_Over3 13 18 23 28 33 38 43
Prod_Reg4 6 11 16 21 26 31
Prod_Over4 13 18 23 28 33 38
Prod_Reg5 6 11 16 21 26
Prod_Over5 13 18 23 28 33
Prod_Reg6 6 11 16 21
Prod_Over6 13 18 23 28
Prod_Reg7 6 11 16
Prod_Over7 13 18 23
Prod_Reg8 6 11
Prod_Over8 13 18
Prod_Reg9 86 76 66 56 46 36 26 16 6
Prod_Over9 93 83 73 63 53 43 33 23 13
 Backlog Cost for All Periods

Dem1 Dem2 Dem3 Dem4 Dem5 Dem6 Dem7 Dem8 Dem9

Prod_Reg1 6 11 16 21 26 31 36 41 46
Prod_Over1 13 18 23 28 33 38 43 48 53
Prod_Reg2 16 6 11 16 21 26 31 36 41
Prod_Over2 23 13 18 23 28 33 38 43 48
Prod_Reg3 26 16 6 11 16 21 26 31 36
Prod_Over3 33 23 13 18 23 28 33 38 43
Prod_Reg4 36 26 16 6 11 16 21 26 31
Prod_Over4 43 33 23 13 18 23 28 33 38
Prod_Reg5 46 36 26 16 6 11 16 21 26
Prod_Over5 53 43 33 23 13 18 23 28 33
Prod_Reg6 56 46 36 26 16 6 11 16 21
Prod_Over6 63 53 43 33 23 13 18 23 28
Prod_Reg7 66 56 46 36 26 16 6 11 16
Prod_Over7 73 63 53 43 33 23 13 18 23
Prod_Reg8 76 66 56 46 36 26 16 6 11
Prod_Over8 83 73 63 53 43 33 23 13 18
Prod_Reg9 86 76 66 56 46 36 26 16 6
Prod_Over9 93 83 73 63 53 43 33 23 13
Target Cell
Changing Cells
Constraints
Target Cell, Changing Cells, Constraints
Change to Min
Options
Solve
Objective Function Value
Problem 2
 LP Formulation; Supply and Demand
Period 1 2 3 4 5 6 Production
1 Regular 300
1 Overtime 300
1 OutSource 300
2 Regular 300
2 Overtime 300
2 OutSource 300
3 Regular 300
3 Overtime 300
3 OutSource 300
4 Regular 300
4 Overtime 300
4 OutSource 300
5 Regular 300
5 Overtime 300
5 OutSource 300
6 Regular 300
6 Overtime 300
6 OutSource 300

200 200 300 400 500 200 0

 LP Formulation; Cost Parameters
Period 1 2 3 4 5 6
1 Regular 2 3 4 5 6 7
1 Overtime 3 4 5 6 7 8
1 OutSource 6 7 8 9 10 11
2 Regular 7 2 3 4 5 6
2 Overtime 8 3 4 5 6 7
2 OutSource 11 6 7 8 9 10
3 Regular 12 7 2 3 4 5
3 Overtime 13 8 3 4 5 6
3 OutSource 16 11 6 7 8 9
4 Regular 17 12 7 2 3 4
4 Overtime 18 13 8 3 4 5
4 OutSource 21 16 11 6 7 8
5 Regular 22 17 12 7 2 3
5 Overtime 23 18 13 8 3 4
5 OutSource 26 21 16 11 6 7
6 Regular 27 22 17 12 7 2
6 Overtime 28 23 18 13 8 3
6 OutSource 31 26 21 16 11 6
 LP Formulation; Sumproduct and Constraints
Period 1 2 3 4 5 6 Production
1 Regular 0 <= 300
1 Overtime 0 <= 300
1 OutSource 0 <= 300
2 Regular 0 <= 300
2 Overtime 0 <= 300
2 OutSource 0 <= 300
3 Regular 0 <= 300
3 Overtime 0 <= 300
3 OutSource 0 <= 300
4 Regular 0 <= 300
4 Overtime 0 <= 300
4 OutSource 0 <= 300
5 Regular 0 <= 300
5 Overtime 0 <= 300
5 OutSource 0 <= 300
6 Regular 0 <= 300
6 Overtime 0 <= 300
6 OutSource 0 <= 300
0 0 0 0 0 0
= = = = = =
200 200 300 400 500 200 0
 LP Formulation; Optimal Solution

Period 1 2 3 4 5 6 Production
1 Regular 200 0 0 0 0 0 200 300
1 Overtime 0 0 0 0 0 0 0 300
1 OutSource 0 0 0 0 0 0 0 300
2 Regular 0 200 0 0 0 0 200 300
2 Overtime 0 0 0 0 0 0 0 300
2 OutSource 0 0 0 0 0 0 0 300
3 Regular 0 0 300 0 0 0 300 300
3 Overtime 0 0 0 0 0 0 0 300
3 OutSource 0 0 0 0 0 0 0 300
4 Regular 0 0 0 300 0 0 300 300
4 Overtime 0 0 0 100 0 0 100 300
4 OutSource 0 0 0 0 0 0 0 300
5 Regular 0 0 0 0 300 0 300 300
5 Overtime 0 0 0 0 200 0 200 300
5 OutSource 0 0 0 0 0 0 0 300
6 Regular 0 0 0 0 0 200 200 300
6 Overtime 0 0 0 0 0 0 0 300
6 OutSource 0 0 0 0 0 0 0 300
200 200 300 400 500 200
200 200 300 400 500 200 3900