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Magsci Presentation
Magsci Presentation
OPERATIONS
MARKETING FINANCIAL
01 02 03 MANAGEMENT
APPLICATIONS APPLICATIONS
APPLICATIONS
LINEAR PROGRAMMING HAS PROVEN TO BE ONE OF
THE MOST SUCCESSFUL QUANTITATIVE
APPROACHES TO DECISION MAKING.
Example:
The requirements that neither the oil nor the steel industry should receive
more than
$50,000 are
A + P ≤ 50 000
M + H ≤ 50 000
The requirement that government bonds be at least 25% of the steel
industry investment is expressed as
G ≥ 0.25 (M + H)
Finally, the constraint that Pacific Oil cannot be more than 60% of the total
oil industry
investment is
P ≤ 0.60 (A + P)
By adding the nonnegativity restrictions, we obtain the complete linear
programming model for the Welte Mutual Funds investment problem:
A, P, M, H, G ≥ 0
Financial Planning
Min F
(Funds available at the beginning of the year) - (Funds invested in bonds and
placed in savings) = (Cash obligation for the current year )
Using these results and the first-year obligation of 430, we obtain the constraint
for year 1:
BM + BP = 5000 Bases
FCM + FCP = 3000 Financial cartridges
TCM + TCP = 2000 Technician cartridges
FTM + FTP = 3000 Financial tops
TTM + TTP = 2000 Technician tops
Production Scheduling
Month 2
s11 + x12 - s12 = 3000
s21 + x22 - s22 = 500
Month 3
s12 + x13 - s13 = 5000
s22 + x23 - s23 = 3000
we can add the constraints
s13 ≥ 400
s23 ≥ 200
Machine Capacity
0.10x11 + 0.08x21 ≤ 400 month 1
0.10x12 + 0.08x22 ≤ 500 month 2
0.10x13 + 0.08x23 ≤ 600 month 3
Labor Capacity
0.05x11 + 0.07x21 ≤ 300 month 1
0.05x12 + 0.07x22 ≤ 300 month 2
0.05113 + 0.07x23 ≤ 300 month 3
Storage Capacity
2s11 + 3s21 = 10,000 month 1
2s12 + 3s22≤ 10,000 month 2
2s13 + 3s23= 10,000 month 3
Workforce Assignment
P1 = units of product 1
P2 = units of product 2
The linear program is
0.65P1 + 0.95P2 ≤ b1
0.45P1 + 0.85P2 ≤ b2
1.00P1 + 0.70P2 ≤ b3
0.15P1 + 0.30P2 ≤ b4
Using department 1 as an example, We
determine the workforce allocation as follows: