University of Tunis Spring 2022

Tunis Business School

BCOR 230: Business Optimization

Final Exam

Question 1 (12 points)

Tunisie Booking is planning a week of marketing for its new service: organized trips during the
summer season. Various advertisements have been produced. The company wants to determine
how much money to spend on TV and magazine ads. Therefore, it defines goals for each segment
of the market to be reached and wants to minimize the cost of this marketing campaign.

The market segments for these organized trips are wealthy families, newlyweds, and retirees. The
following table shows the number (in millions) of people reached by segment for each minute of
television advertising and each page of magazine as well as the related cost and the defined goals
to achieve for each segment.

Type Wealthy families Newlyweds Retirees Cost

TV 5 1 3 600
Mag 2 6 3 500
Goal (at least) 24 18 24

- We want to answer the question: How many ads to run on TV and how many pages of
magazines are needed to reach the goals while minimizing the cost? Model the problem as
a LP. You are asked to model, not to solve.

Question 2 (40 points)

The following LP represents a product mix problem of a furniture company that manufactures 3
products (desks, tables, and chairs). The 3 first constraints are lumbar, finishing hours and carpentry
hours. They represent resource availability constraints respectively while the last constraint is the
demand limitation for tables (the demand for desks and chairs is assumed to be unlimited):
𝑀𝑎𝑥 𝑍 = 60𝑥1 + 30𝑥2 + 20𝑥3
8x1 + 6x2 + x3 ≤ 48 (Lumbar constraint)
4x1 + 2x2 + 1.5x3 ≤ 20 (Finishing constraint)
subject to 2x1 + 1.5x2 + 0.5x3 ≤ 8 (Carpentry constraint)
x2 ≤ 5 (Limitation on table demand)
{ x1 , x2 , x3 ≥ 0

1
The optimal tableau is given below:
Basis x1 x2 x3 s1 s2 s3 s4 RHS
0 s1 0 -2 0 1 2 -8 0 24
20 x3 0 -2 1 0 2 -4 0 8
60 x1 1 1,25 0 0 -0,5 1,5 0 2
0 s4 0 1 0 0 0 0 1 5
C-bar 0 -5 0 0 -10 -10 0 Z=280

1) By how much the profit rate of product 2 must be increased to become profitable?
2) If additional carpentry hours can be outsourced, what would the company be willing to
pay per additional hour?
3) If the supply of lumbar was reduced by 10 units, how will this reduction impact the
optimal solution
4) If the company obtains unlimited access to lumbar, how would that impact the optimality
of the current solution?
5) Perform a sensitivity analysis to the second constraint as well as to product 3’s profit rate.
6) The company is considering manufacturing home computer tables. A home computer
table uses 6 board ft of lumbar, 2 finishing hours, and 2 carpentry hours. What should be
the minimum profit rate of the home computer tables in order to be incorporated in the
production plan?

Question 3 (30 points)

Consider the following problem consisting on maximizing the profit rate of a company. Note that
both constraints deal with raw materials 1 and 2 availability.

Maximize: 2𝑥1 + 3𝑥2 + 2𝑥3 + 4𝑥4

2𝑥1 + 𝑥2 + 3𝑥3 + 2𝑥4 ≤ 8
subject to {3𝑥1 + 2𝑥2 + 2𝑥3 + 𝑥4 ≤ 7
𝑥1 , 𝑥2 , 𝑥3 , 𝑥4 ≥ 0
1) Establish the standard form.
2) Apply the simplex algorithm.
3) Identify the dual LP.
4) Represent the feasible region of the dual LP.
5) Solve graphically the dual LP.

2
Question 4 : Multiple choice questions (18 points)
1) Consider the following LP: 4) If the optimal simplex tableau of an LP
has only zero or positive numbers in the
𝑀𝑎𝑥 𝑍 = 6𝑥1 + 4𝑥2
c-bar row, this indicates that:
𝑥1 − 4𝑥2 ≥ 2 (a) The LP is unfeasible
𝑥 + 𝑥2 ≥ 4 (b) The program is a minimization LP
{ 1
𝑥2 ≥ 1 (c) The LP has been incorrectly
𝑥1 , 𝑥2 ≥ 0 formulated
(d) The LP has an unbounded solution
Solve the LP graphically (no need to include
(e) None of the above
the graph) and indicate if:
(a) This LP has a unique optimal solution 5) The signs of the variables in the dual of
(b) This LP has multiple optimal solutions an LP depend on:
(c) This LP is unfeasible (a) The signs of the variables in the
(d) This LP is unbounded primal
(e) None of the above (b) Whether the dual is a maximization
or a minimization LP
2) Without doing any simplex iterations of (c) Whether the constraints in the primal
the LP above indicate if: follow the canonical form of the
(a) In the optimal simplex tableau of this primal LP
LP some non-basic variables have a c- (d) Nothing. Dual variables are always
bar value of zero greater than or equal to zero
(b) The RHS column contains one or more (e) None of the above
negative values
(c) The pivot column (except for the c-bar 6) A constraint is called binding if:
value) only contains zero or negative (a) Graphically, the point representing
numbers the optimal solution is on the line
(d) None of the above representing the constraint
(b) The slack variable associated to it is
3) If the optimal simplex tableau of an LP greater than zero in the optimal
has a non-basic variable with a null c-bar simplex tableau
value, this indicates that: (c) Removing it from an LP after it has
(a) The LP is unfeasible been solved causes no changes to the
(b) The LP is unbounded optimality of the basis
(c) The LP has an infinite number of optimal (d) None of the above
solutions
(d) The LP has been incorrectly formulated 7) A constraint is called inactive if:
(e) None of the above (a) Removing it from the optimal simplex
tableau requires forcing its associated
slack variable to enter the basis then
deleting its row and column

3
 (b) Increasing the value of its right-hand (a) 𝑎 + 𝑏 + 𝑐 + 𝑑 = 3
side results in a better objective value (b) 𝑎 + 𝑏 + 𝑐 + 𝑑 ≤ 3
(c) Decreasing the value of its right-hand (c) 𝑎 + 𝑏 + 𝑐 + 𝑑 ≥ 3
side by any value will lead to a worse
objective value 9) Let a, b, c, and d denote the respective
(d) None of the above decision variables related to projects A, B, C
and D, that we may or may not decide to do.
8) Let a, b, c, and d denote the respective
If A is selected, then B cannot be selected.
decision variables related to projects A,
This is expressed as:
B, C and D, that we may or may not
(a) 𝑎 = 1 − 𝑏
decide to do.
(b) 𝑎 ≤ 1 − 𝑏
At least 3 projects need to be selected.
This is expressed as: