CEDRON, CRISHA MAE M.

OLA-LP Model Formulation

1.
Suppose

� = ��. �� ����� �� ���������� ���� ���

� = ��. �� ����� �� ���������� ���� ���

These are the decision variables

����� ���� = 500� + 250�

This is the objective function

The
---- constraints
1 are –

� ≤ 15 ---- 1
� ≤ 35 ---- 2
150� + 50� ≥ 2250 ---- 3
400� + 100� ≥ 5000 ---- 4
We need to minimize the cost. Hence, the LPP is

��� � = 500� + 250�

Subject to constraints –

� ≤ 15
� ≤ 35
150� + 50� ≥ 2250
400� + 100� ≥ 5000
Find the solution using Simplex method (BigM method)

��� � = 500�1 + 250�2

Subject to

�1 ≤ 15
�2 ≤ 35
150�1 + 50�2 ≥ 2250
400�1 + 100�2 ≥ 5000
��� �1 , �2 ≥ 0
Solution:

Problem is

��� � = 500�1 + 250�2

Subject to

�1 ≤ 15
�2 ≤ 35
150�1 + 50�2 ≥ 2250
400�1 + 100�2 ≥ 5000
��� �1 , �2 ≥ 0
The problem is converted to canonical form by adding slack, surplus and artificial variables as
appropriate

1. As the cionstraint-1 is of type ‘≤’ we should add slack variable �1

2. As the constraint-2 is of type ‘≤’ we should add slack variable �2
3. As the constraint-3 is of type ‘≥’ we should subtract surplus variable �3 and add artificial variable
�1
4. As the constraint-4 is of type ‘≥’ we should subtract surplus variable �4 and add artificial variable
�2

After introducing slack, surplus, artificial variables

��� � = 500�1 + 250�2 + 0�1 + 0�2 + 0�3 + 0�4 + ��1 + ��2

Subject to

�1 + �1 = 15
�2 + �2 = 35
150�1 + 50�2 − �3 + �1 = 2250
400�1 + 100�2 − �4 + �2 = 5000
��� �1 , �2 , �1 , �2 , �3 , �4 , �1 , �2 ≥ 0

Positive maximum �� − �� is 500� − 500 and its column index is 1. So, the entering variable is
�1 .
Minimum ration is 12.5 and its row index is 4. So, the leaving basis variable is �2 .

The pivot element is 400

�������� = �1 , ��������� = �2 , ��� ������� = 400

+�4 ��� = �4 ��� ÷ 400

+�1 ��� = �1 ��� − �4 (���)
+�2 ��� = �2 ���
+�3 ��� = �3 ��� − 150�4 (���)

Iteration-2 �� 50 250 0 0 0 0 �
0
� �� �� �� �� �� �� �� �� �� MinRati
o
��
��

�1 0 2.5 0 -0.25 1 0 0 0.0025 0 ---

�2 0 35 0 1 0 1 0 0 0 35
= 35
1

�� � 375 0 (12.5) 0 0 -1 0.375 1 375

12.5
= 30

�1 50 12. 1 0.25 0 0 0 -0.0025 0 12.5

0 5 0.25
= 50

� �� 50 ��. �� 0 0 �. ���� �
= ���� 0 + ��� −� − �. ��
+ ����
�� 0 12.5 − 125 0 0 −� 0.375� 0
− �� − 1.25

Positive maximum �� − �� is 12.5� and its column index is 2. So, the entering variable is �2 .

Minimum ration is 30 and its row index is 3. So, the leaving basis variable is �1 .

The pivot element is 12.5

�������� = �2 , ��������� = �1 , ��� ������� = 12.5

+�3 ��� = �3 ��� ÷ 12.5
+�1 ��� = �1 ��� + 0,25�3 (���)
+�2 ��� = �2 ��� − �3 ���
+�4 ��� = �4 ��� − 0.25�3 (���)

Iteration-3 �� 500 250 0 0 0 0

� �� �� �� �� �� �� �� �� MinRatio
��
��

�1 0 10 0 0 1 0 -0.02 (0.01) 10
0.01
= 1000

�2 0 5 0 0 0 1 0.08 -0.03 ---

�� 250 30 0 1 0 0 -0.08 0.03 30
0.03
= 1000

�1 500 5 1 0 0 0 0.02 -0.01 ---

� �� ��� ��� 0 0 �. �
= ����� −��
�� 0 0 0 0 −10 2.5
− ��

Positive maximum �� − �� is 2.5 and its column index is 6. So, the entering variable is �4 .

Minimum ration is 1000 and its row index is 1. So, the leaving basis variable is �1 .

The pivot element is 0.01

�������� = �4 , ��������� = �1 , ��� ������� = 0.01

+�1 ��� = �1 ��� ÷ 0.01

+�2 ��� = �2 ��� + 0.03�1 (���)
+�3 ��� = �3 ��� − 0.03�1 ���
+�4 ��� = �4 ��� + 0.01�1 (���)

Iteration- �� 500 250 0 0 0 0

4
� �� �� �� �� �� �� �� �� MinRatio

�4 0 10 0 0 100 0 -2 1
�2 0 5 0 0 3 1 0.02 0
�� 250 30 0 1 -3 0 -0.02 0
�1 500 5 1 0 1 0 0 0
� �� ��� ��� -250 0 0
= ���� −�
�� 0 0 -250 0 −5 0
− ��

Since all �� − �� ≤ 0

Hence, optimal solution is arrived with value of variables as : �1 = 15, �2 = 0

��� � = 7500

Hence, 15 weeks of production from XYZ should be contracted to minimize cost:

The minimized cost is $7500

2. Suppose

� = ��. �� ���������� �� ����� ����� ��������

� = ��. �� ���������� �� ���������� ����� ��������
� = ��. �� ���������� �� ���ℎ�� ����� ��������
� = ��. �� ���������� �� ��� − �� − ��� ����� ��������

�ℎ��, ������ �� ����� ����� = 3 − 1 � = 2�

������ �� ���������� ����� = 2 − 0.5 � = 1.5�
������ �� ���ℎ�� ����� = 2.5 − 1.5 � = �
������ �� ��� − �� − ��� = 4 − 2 � = 2�

����� ������ = � = 2� + 1.5� + � + 2�

����� ����� ������ = 1� + 0.25�

����� ���������� ������ = 2� + 0.25�
����� ���ℎ�� ������ = 1.25� + 0.25�

�ℎ��, � + 0.25� ≤ 400

2� + 0.25� ≤ 300
1.25� + 0.25� ≤ 200

� 8
≥
� 5

= 5� − 8� ≥ 0
����� ������ �� ���� �������� = � + � + � + �
30
�ℎ��, � ≤ (� + � + � + �)
100
= 10� ≤ 3� + 3� + 3� + 3�
= 3� − 7� + 3� + 3� ≥ 0

1
����, � ≤ (� + � + � + �)
3
= 3� ≤ � + � + � + �
= � + � − 2� + � ≥ 0

Hence the LPP model is

��� � = 2� + 1.5� + � + 2� ��������� ��������

�������� ��������� − �, �, �, �
Constraints are –

� + 0.25� ≤ 400 ---- 1

2� + 0.25� ≤ 300 ---- 2
1.25� + 0.25� ≤ 200 ---- 3
5� − 8� ≥ 0 ---- 4
3� − 7� + 3� + 3� ≥ 0 ---- 5
� + � − 2� + � ≥ 0 ---- 6