Lecture 4 Linear Programing Applications in Operations

The steps of solving problems using Linear Programing:

1. Understand Problem
2. Construct a Linear Programing Model for the problem
3. Solve the Linear Programing Model
1. Are the constraints too demanding/contradicting: Relax the constraint.
2. Unbound: Missing constraint: Put back the constraint.

4. Study the sensitivity analysis

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 Lecture 4 Linear Programing Applications in Operations
• Linear Programing has proven to be one of the most successful
approaches in Decision Making.
• We have studied the structure of Linear Programing (LP). We will
look at how LP can be applied in the operations of various
industries/departments.
• The applications we will learn in this lesson (Ref: Textbook Chapter
4) are
Application Complexity level
– Media Selection 1.5
– Marketing Research 1
– Financial Planning 2
– Make or Buy Decision 1.5
– Production Scheduling 3
– Workforce Assignment 2
– Blending Problems 1.5
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Application 1: Media Selection

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Application 1: Media Selection

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Application 1: Media Selection

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Application 1: Media Selection

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Application 1: Media Selection

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Application 2: Marketing Research

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Application 2: Marketing Research

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Application 2: Marketing Research

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Application 2: Marketing Research

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Application 2: Marketing Research

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Application 3: Financial Planning

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Application 3: Financial Planning

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Application 3: Financial Planning

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Application 3: Financial Planning

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Application 3: Financial Planning

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Application 2: Financial Planning

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Application 3: Financial Planning

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Application 4: A Make or Buy Decision

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Application 4: A Make or Buy Decision

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Application 3: A Make or Buy Decision

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Application 3: A Make or Buy Decision

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Application 4: A Make or Buy Decision

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Application 4: A Make or Buy Decision

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Application 5: Production Scheduling

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Application 4: Production Scheduling

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Application 5: Production Scheduling

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Application 4: Production Scheduling

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Application 5: Production Scheduling

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Application 4: Production Scheduling

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Application 5: Production Scheduling

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Application 5: Production Scheduling

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Application 4: Production Scheduling

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Application 4: Production Scheduling

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Application 4: Production Scheduling

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Application 5: Production Scheduling

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Application 4: Production Scheduling

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Application 5: Production Scheduling

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Application 6: Workforce Assignment

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Application 5: Workforce Assignment

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Application 5: Workforce Assignment

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Application 5: Workforce Assignment

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Application 5: Workforce Assignment

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Application 5: Workforce Assignment

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Application 5: Workforce Assignment

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Application 7: Blending Problems

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Application 6: Blending Problems

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Application 6: Blending Problems

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Application 6: Blending Problems

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Application 7: Blending Problems

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Application 6: Blending Problems

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Application 7: Blending Problems

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 Application 6: Blending Problems

Note

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 Class Activity: Production Scheduling
Chip Hoose is the owner of Hoose Custom Wheels.
Chip has just received orders for 1,000 standard wheels
and 1,250 deluxe wheels next month and for 800
standard and 1,500 deluxethe following month. All
orders must be filled.

The cost of making standard wheels is $10 and

deluxe wheels is $16. Over-time rates are 50% higher.
There are 1,000 hours of regular time and 500 hours of
overtime available each month. It takes .5 hour to
make a standard wheel and .6 hour to make a deluxe
wheel. The cost of storing a wheel from one month to
the next is $2.
Construct a LP Model to to minimize total production
and inventory costs for standard and deluxe wheels.
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 Define the Decision Variables
We want to determine the regular-time and overtime
production quantities in each month for standard and
deluxe wheels.
Month 1 Month 2
Wheel Reg. Time Overtime Reg. Time Overtime
Standard SR1 SO1 SR2 SO2
Deluxe DR1 DO1 DR2 DO2

We also want to determine the inventory quantities

for standard and deluxe wheels.
SI = number of standard wheels held in
inventory from month 1 to month 2
DI = number of deluxe wheels held in
inventory from month 1 to month 2
What happen from moth 2 to month 3?
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