Chapter 5

Linear Programming Models:

Graphical and Computer Methods
 Chapter Outline
7.1 Introduction
7.2 Requirements of a Linear Programming Problem
7.3 Formulating LP Problems
7.4 Graphical Solution to an LP Problem
7.5 Solving LP Problem (QM for Window and Excel)
7.6 Solving Minimization Problems
7.7 Four Special Cases in LP
7.8 Sensitivity Analysis
 Linear Programming: An Overview
 Objectives of business decisions frequently involve
maximizing profit or minimizing costs.
 Linear programming is an analytical technique in which linear
algebraic relationships represent a firm’s decisions, given a
business objective, and resource constraints.

 Steps in application:
 Identify problem as solvable by linear programming.
 Formulate a mathematical model of the unstructured
problem.
 Solve the model.
 Implementation
 Requirements of LP Problems and
LP Basic Assumptions
Requirements
• Decision variables - mathematical symbols representing levels of activity of a firm.
• Objective function - a linear mathematical relationship describing an objective of the
firm, in terms of decision variables - this function is to be maximized or minimized.
• Constraints – requirements or restrictions placed on the firm by the operating
environment, stated in linear relationships of the decision variables.
• Parameters - numerical coefficients and constants used in the objective function and
constraints.

Assumptions
• Proportionality - The rate of change (slope) of the objective function and constraint
equations is constant.
• Additivity - Terms in the objective function and constraint equations must be additive.
• Divisibility -Decision variables can take on any fractional value and are therefore
continuous as opposed to integer in nature.
• Certainty - Values of all the model parameters are assumed to be known with certainty
(non-probabilistic).
• Non-negativity - all answers or variables are greater than or equal to (≥) zero
 Pho Hu tieu
(40K VND/bowl) (50K VND/bowl)

Minime Restaurant
Chef Meat
(works 40 min./day) (120 grs meat/day)

I can prepare 1 bowl of:

- Pho in 1 min.
- Hu tieu in 2 min.
1 bowl of:
- Pho needs 4 gr meat
- Hu tieu neads 3 gr. meat
 LP Model Formulation
A Maximization Example (1 of 3)
– Product mix problem – Minime Noodle Restaurant
How many bowls of Pho and Hu tieu should be prepared to maximize
profits given labor and materials constraints?
– Product resource requirements and unit profit:

Products Resource Requirements Profits

Labor Meat (K. VND/bowl)
(min./bowl) (gr./bowl)
Pho 1 4 40
Hu tieu 2 3 50
Resource 40 min. 120 grs.
Availability
 LP Model Formulation
A Maximization Example (2 of 3)
Products Resource Requirements Profits
Labor (min./bowl) Meat (gr./bowl) (K. VND/bowl)
Pho 1 4 40
Hu tieu 2 3 50
Avail. Resource 40 120
Trial and error
• All for Pho: Time Meat Profit
40 bowls 30 bowls 30 bowls x 40= 1200 (chef’s time surplus)

• All for Hu tieu:

20 bowls 40 bowls 20 bowls x 50= 1000 (meat surplus)

Half for Pho and Half for Hu tieu

PHO 20 bowls 15 bowls 15 bowls x 40= 600 (chef’s time surplus)
 LP Model Formulation
A Maximization Example (3 of 3)

Decision x1 = # of bowls of Pho to prepare per day

Variables: x2 = # of bowls of Hu tieu to prepare per
day
Objective Maximize Z = 40x1 + 50x2
Function: Where Z = profit per day
subject to (s.t.):
Resource 1x1 + 2x2  40 minutes of labor
Constraints: 4x1 + 3x2  120 grs. of meat

Non-Negativity x1  0; x2  0
Constraints:
 Feasible and Infeasible Solutions
 A feasible solution does not violate any of the constraints:
Example x1 = 5 bowls of Pho
x2 = 10 bowls of Hu tieu
Z = 40x1 + 50x2 = 700 (K.VND)
Labor constraint check:
1(5) + 2(10) = 25 < 40 minutes, within constraint
Meat constraint check:
4(5) + 3(10) = 70 < 120 grams, within constraint

 An infeasible solution violates at least one of the constraints:

Example x1 = 10 bowls of Pho
x2 = 20 bowls of Hu tieu
Z = 1400 (K.VND)
Labor constraint check:
1(10) + 2(20) = 50 > 40 minutes, violates constraint
 Graphical Solution of LP Models

• Graphical solution is limited to linear programming

models containing only two decision variables (can
be used with three variables but only with great
difficulty).

• Graphical methods provide visualization of how a

solution for a linear programming problem is
obtained.
 Coordinate Axes
Graphical Solution of Maximization Model (1 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.2 Coordinates for

Graphical Analysis
 Labor Constraint
Graphical Solution of Maximization Model (2 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.3 Graph of Labor

Constraint
 Labor Constraint Area
Graphical Solution of Maximization Model (3 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.4 Labor Constraint Area

 Meat Constraint Area
Graphical Solution of Maximization Model (4 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.5 Clay Constraint Area

 Both Constraints
Graphical Solution of Maximization Model (5 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.6 Graph of Both Model

Constraints
 Feasible Solution Area
Graphical Solution of Maximization Model (6 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.7 Feasible Solution Area

 Graphical Solution Methods
ISOPROFIT METHOD
1. Graph all constraints and find the feasible region.
2. Select a specific profit (or cost) line and graph it to find the slope.
3. Move the objective function line in the direction of increasing profit
(or decreasing cost) while maintaining the slope. The last point it
touches in the feasible region is the optimal solution.
4. Find the values of the decision variables at this last point and
compute the profit (or cost).

CORNER POINT METHOD

1. Graph all constraints and find the feasible region.
2. Find the corner points of the feasible reason.
3. Compute the profit (or cost) at each of the feasible corner points.
4. select the corner point with the best value of the objective function
found in Step 3. This is the optimal solution.
 Isoprofit Line Method
Graphical Solution of Maximization Model (7 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0
Construct the isoprofit line:
Z = 40x1 + 50x2

x2 = Z/50 - 40/50x1

= Z/50 -4/5x1

Figure 2.8 Objection Function Line

for Z = $800
 Isoprofit Line Method
Graphical Solution of Maximization Model (8 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.9 Alternative Objective

Function Lines
 Isoprofit Line Method
Graphical Solution of Maximization Model (9 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.10 Identification of

Optimal Solution
 Optimal Solution Coordinates
Graphical Solution of Maximization Model (10 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.11 Optimal Solution

Coordinates
 Extreme (Corner) Point Method
Graphical Solution of Maximization Model (11 of 11)

Maximize Z = 40x1 + 50x2

subject to: 1x1 + 2x2  40
4x1 + 3x2  120
x1, x2  0

Figure 2.12 Solutions at All Corner

Points
 Using Excel’s Solver
to Solve LP Problems

 The Solver tool in Excel can be used to find

solutions to
 LP problems
 Integer programming problems
 Noninteger programming problems
 Solver may be sensitive to the initial values it uses
 Solver is limited to 200 variables and 100
constraints
 It can be used for small real world problems
 Add-ins like What’s Best! Can be used to expand
Solver’s capabilities
 Using Excel’s Solver
to Solve LP Problems
Maximize Z = 40 x1 + 50 x2
Subject to
Click on “Tools”
to invoke “Solver.” x1 + 2x240 mins. (labor constraint)
4x1 + 3x2120 grs. (meat constraint)
Objective function x1 , x2 0

=E6-F6

=E7-F7

=C6*B10+D6*B11

=C7*B10+D7*B11

Decision variables – Pho

(x1)=B10; Hu tieu (x2)=B11
 Using Excel’s Solver
to Solve LP Problems
After all parameters and constraints
have been input, click on “Solve.”

Objective function

Decision variables

C6*B10+D6*B11≤40
C7*B10+D7*B11≤120

Click on “Add” to
insert constraints
Using Excel’s Solver
to Solve LP Problems
 Using QM for Windows and Excel
Solving Flair Furniture’s LP Problem

Maximize profit = $70T + $50C

subject to
4T + 3C ≤240 (carpentry constraint)
2T + 1C ≤100 (painting and varnishing constraint)
T, C ≥ 0 (nonnegativity constraint)

• Most organizations have access to software to solve big LP problems

• While there are differences between software implementations, the
approach each takes towards handling LP is basically the same
• Once you are experienced in dealing with computerized LP algorithms, you
can easily adjust to minor changes
 Using QM for Windows
 First select the Linear Programming module
 Specify the number of constraints (non-negativity is assumed)
 Specify the number of decision variables
 Specify whether the objective is to be maximized or minimized
 For the Flair Furniture problem there are two constraints, two
decision variables, and the objective is to maximize profit

 Computer screen for input of data

 Using QM for Windows
 Computer screen for input of data

 Computer screen for output of solution

 Using QM for Windows
 Graphical output of solution
 LP Model Formulation
A Minimization Example (1 of 6)

 Two brands of fertilizer available - Super-Gro, Crop-

Quick.
 Field requires at least 16 pounds of nitrogen and 24
pounds of phosphate.
 Super-Gro costs $6 per bag, Crop-Quick $3 per bag.
 Problem: How much of each brand to purchase to
minimize total cost of fertilizer given following data ?
Chemical Contribution

Nitrogen Phosphate
Brand
(lb/bag) (lb/bag)
Super-gro 2 4

Crop-quick 4 3
Fertilizing Farmer’s
Field
 LP Model Formulation
A Minimization Example (2 of 6)

Decision Variables:
x1 = bags of Super-Gro
x2 = bags of Crop-Quick

The Objective Function:

Minimize Z = 6x1 + 3x2

Model Constraints:
2x1 + 4x2  16 lb (nitrogen constraint)
4x1 + 3x2  24 lb (phosphate constraint)
x1, x2  0 (non-negativity constraint)
 LP Model Formulation and Constraint Graph
A Minimization Example (3 of 6)

Minimize Z = $6x1 + $3x2

subject to: 2x1 + 4x2  16
4x1 + 3x2  24
x1, x2  0

Figure 2.16 Graph of Both Model

Constraints
 Feasible Solution Area
A Minimization Example (4 of 6)

Minimize Z = $6x1 + $3x2

subject to: 2x1 + 4x2  16
4x1 + 3x2  24
x1, x2  0

Figure 2.17 Feasible Solution Area

 Optimal Solution Point
A Minimization Example (5 of 6)

Minimize Z = $6x1 + $3x2

subject to: 2x1 + 4x2  16
4x1 + 3x2  24
x1, x2  0
Construct the objective line:
Z = 6x1 + 3x2

x2 = Z/3 – 6/3x1

x2 = Z/3 -2x1

Figure 2.18 Optimum Solution

Point
 Graphical Solutions
A Minimization Example (6 of 6)

Minimize Z = $6x1 + $3x2

subject to: 2x1 + 4x2  16
4x1 + 3x2  24
x1, x2  0

Figure 2.19 Graph of Fertilizer

Example
 Four Special Cases in LP

• Four special cases and difficulties arise at times when

using the graphical approach to solving LP problems

– Infeasibility
– Unboundedness
– Redundancy
– Alternate Optimal Solutions
 Four Special Cases in LP
• Infeasibility-A problem with no feasible solution
– Exists when there is no solution to the problem that satisfies
all the constraint equations
– No feasible solution region exists
X2

8–
–
6–
– Region Satisfying
4– Third Constraint
–
2–
–
0– | | | | | | | | | |
2 4 6 8 X1
Region Satisfying First Two Constraints
 Four Special Cases in LP
• Unboundedness- A solution region unbounded to the right
– In a graphical solution, the feasible region will be open ended
– This usually means the problem has been formulated improperly

X2

X1 ≥ 5
15 –

X2 ≤ 10
10 –

Feasible Region
5–
X1 + 2X2 ≥ 15
| | | | |
0– 5 10 15 X1
 Four Special Cases in LP
• Redundancy- A problem with a redundant constraint
– A redundant constraint is one that does not affect the feasible solution
region
X2

30 –

25 –
2X1 + X2 ≤ 30

20 –
Redundant
Constraint
15 –
X1 ≤ 25

10 – X1 + X2 ≤ 20
Feasible
5– Region

| | | | | |
0–
5 10 15 20 25 30 X1
 Four Special Cases in LP
• Alternate optimal solutions
– Occasionally two or more optimal solutions may exist
X2 – Graphically this occurs when the objective function’s isoprofit or
isocost line runs perfectly parallel to one of the constraints
8–

7–
A
6– Optimal Solution Consists of All
Combinations of X1 and X2 Along
5– the AB Segment
4–

3– Isoprofit Line for $8

2–
B Isoprofit Line for $12
1 – Feasible Overlays Line Segment AB
Region
0– | | | | | | | |
1 2 3 4 5 6 7 8 X1
 Sensitivity Analysis

• Sensitivity analysis is used to determine

effects on the optimal solution within
specified ranges for the objective function
coefficients, constraint coefficients, and right
hand side (RHS) values.

• Sensitivity analysis provides answers to

certain what-if questions.
 Range of Optimality
• A range of optimality of an objective function coefficient is found by
determining an interval for the objective function coefficient in which the
original optimal solution remains optimal while keeping all other data of
the problem constant. The value of the objective function may change in
this range.

• Graphically, the limits of a range of optimality are found by changing the

slope of the objective function line within the limits of the slopes of the
binding constraint lines. (This would also apply to simultaneous changes
in the objective coefficients.)

• The slope of an objective function line, Max c1x1 + c2x2, is

-c1/c2
The slope of a constraint, a1x1 + a2x2 = b, is -a1/a2
 Shadow Price
• A shadow price for a RHS value (or resource limit) is the
amount the objective function will change per unit increase in
the right hand side value of a constraint.
• Graphically, a shadow price is determined by adding +1 to the
right hand side value in question and then resolving for the
optimal solution in terms of the same two binding constraints.

• The shadow price is equal to the difference in the values of

the objective functions between the new and original
problems.
• The shadow price for a nonbinding constraint is 0.
 Example: Sensitivity Analysis
• Solve graphically for the optimal solution:

Max z = 5x1 + 7x2

s.t. x1 < 6
2x1 + 3x2 < 19
x1 + x2 < 8

x1, x2 > 0
 Example: Sensitivity Analysis
• Graphical Solution
x2
8
x1 + x2 < 8
Max 5x1 + 7x2
7

6
x1 < 6
5
Optimal x1 = 5, x2 = 3
4
z = 46
3

2
2x1 + 3x2 < 19
1

1 2 3 4 5 6 7 8 9 10
x1
 Example: Sensitivity Analysis
• Range of Optimality for c1
The slope of the objective function line is -c1/c2.
The slope of the 1st binding constraint, x1 + x2 = 8, is -1,
the slope of the 2nd binding constraint, 2x1 + 3x2 = 19, is -2/3.
Find the range of values for c1 (with c2 staying 7) such that
the objective function line slope lies between that of the two
binding constraints:
-1 < -c1/7 < -2/3

Multiplying through by -7 (and reversing the inequalities):

14/3 < c1 < 7
 Example: Sensitivity Analysis

• Range of Optimality for c2

Find the range of values for c2 ( with c1 staying 5)
such that the objective function line slope lies between
that of the two binding constraints:
-1 < -5/c2 < -2/3

Multiplying by -1: 1 > 5/c2 > 2/3

Inverting, 1 < c2/5 < 3/2

Multiplying by 5: 5 < c2 < 15/2

 Example: Sensitivity Analysis
• Shadow Prices
Constraint 1: Since x1 < 6 is not a binding constraint, its
shadow price is 0.

Constraint 2: Change the RHS value of the 2 nd constraint to 20 and resolve for the
optimal point determined by the last two constraints: 2x1 + 3x2 = 20 and x1 + x2 =
8.
The solution is x1 = 4, x2 = 4, z = 48.
Hence, the shadow price = znew - zold = 48 - 46 = 2.

Constraint 3: Change the RHS value of the 3 rd constraint to 9 and resolve for the
optimal point determined by the last two constraints: 2x1 + 3x2 = 19 and x1 + x2 =
9.
The solution is: x1 = 8, x2 = 1, z = 47.
Hence, the shadow price = znew - zold = 47 - 46 = 1.