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Assignment-1 MATH 371 (Fall 2018)

The document provides instructions for an operations research assignment with 5 questions. It specifies that the assignment is due on October 21st 2019 and must be submitted as a hard copy. It instructs students to work individually or in groups of 2 and provides guidelines for completing and submitting the assignment. The assignment questions involve formulating linear programming models to optimize various operations problems related to scheduling production, minimizing costs, and maximizing profits.

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219 views

Assignment-1 MATH 371 (Fall 2018)

The document provides instructions for an operations research assignment with 5 questions. It specifies that the assignment is due on October 21st 2019 and must be submitted as a hard copy. It instructs students to work individually or in groups of 2 and provides guidelines for completing and submitting the assignment. The assignment questions involve formulating linear programming models to optimize various operations problems related to scheduling production, minimizing costs, and maximizing profits.

Uploaded by

umar khan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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OPERATIONS RESEARCH – I MATH 341

Instructor: Kamran Rashid

ASSIGNMENT-1 Max Marks = 50

Due Date: Monday, 21 October 2019 (8:00 AM)


Note: Extension will not be allowed for this assignment.

Submission Method: Hard Copy to be submitted in class on 21 Oct 2019, 8:00 AM


Note: Other methods of submission are not acceptable.
____________________________________________________________________________

Answer all the five questions (Attached), each question carries 10 marks. In LP
formulations, make sure to clearly define the variables, and label each constraint.

INSTRUCTIONS:

1. You may work on this assignment individually, or in teams of maximum of two students
each. A team needs to make only one submission which should be the joint effort of both
team members.

2. The Assignment can be submitted in either Typed form or Handwritten.

3. Hard copy of the assignment report has to be submitted in class on Monday, 21 October
2019, at start time of class. No other form of submission will be accepted without prior
approval from instructor.

4. You are not allowed to share/discuss any portion of your assignment with anyone else
other than your team member, TA, and the instructor.

5. You are not allowed to use the web (or similar) resources related to the specific solutions
of the given problems.

6. The submitted assignment should be your own original work, and should not be shared
with any other student in our class.
You also need to provide the above testimony along with signatures of all team members
on the title page of your submission.
Your assignment will not be graded without this signed testimony.
Q. 1 As part of the settlement for a class action lawsuit, Hoxworth Corporation must provide
sufficient cash to make the following annual payments (in thousands of dollars).

Year 1 2 3 4 5 6
Payment 175 215 240 285 315 460

The annual payments must be made at the beginning of each year. The judge will approve an
amount that, along with earnings on its investment, will cover the annual payments.

Investment of the funds will be limited to savings (at 4% annually) and government securities, at
prices and rates currently quoted in The Wall Street Journal. Hoxworth wants to develop a plan
for making the annual payments by investing in the following securities (par value = $1000).
Funds not invested in these securities will be placed in savings.

Security Current Price Rate (%) Years to Maturity


1 $1055 6.750 3
2 $1000 5.125 4

Assume that interest is paid annually. The plan will be submitted to the judge and, if approved,
Hoxworth will be required to pay a trustee the amount that will be required to fund the plan.

Formulate a Linear program to minimize the cash settlement necessary to fund the annual
payments.
Q. 2 Hilltop Coffee manufactures a coffee product by blending three types of coffee beans.
The cost per pound and the available pounds of each bean are as follows:

Bean Cost per Pound Available Pounds


1 $0.50 500
2 $0.70 600
3 $0.45 400

Consumer tests with coffee products were used to provide ratings on a scale of 0–100, with
higher ratings indicating higher quality.

Product quality standards for the blended coffee require a consumer rating for aroma to be at
least 75 and a consumer rating for taste to be at least 80. The individual ratings of the aroma and
taste for coffee made from 100% of each bean are as follows:

Bean Aroma Rating Taste Rating


1 75 86
2 85 88
3 60 75

Assume that the aroma and taste attributes of the coffee blend will be a weighted average of the
attributes of the beans used in the blend.

Formulate the above problem as a Linear program that will determine the optimal blend to
provide1000 pounds of the blended coffee product.
Q. 3 The Silver Star Bicycle Company will be manufacturing both men’s and women’s
models for its Easy-Pedal 10-speed bicycles during the next two months.

Management wants to develop a production schedule indicating how many bicycles of each
model should be produced in each month. Current demand forecasts call for 150 men’s and 125
women’s models to be shipped during the first month and 200 men’s and 150 women’s models
to be shipped during the second month. Additional data are shown:

Labor Requirements (hours)


Model Production Manufacturing Assembly Current
Costs Inventory
Men’s $ 120 2.0 1.5 20
Women’s $ 90 1.6 1.0 30

Last month the company used a total of 1000 hours of labor. The company’s labor relations
policy will not allow the combined total hours of labor (manufacturing plus assembly) to
increase or decrease by more than 100 hours from month to month.

In addition, the company charges monthly inventory at the rate of 2% of the production cost
based on the inventory levels at the end of the month. The company would like to have at least
25 units of each model in inventory at the end of the two months.

Formulate a Linear program to develop the optimal production schedule.


Q. 4 Romans Food Market, located in Saratoga, New York, carries a variety of specialty foods
from around the world. Two of the store’s leading products use the Romans Food Market name:
Romans Regular Coffee and Romans DeCaf Coffee. These coffees are blends of Brazilian
Natural and Colombian Mild coffee beans, which are purchased from a distributor located in
New York City. Because Romans purchases large quantities, the coffee beans may be purchased
on an as-needed basis for a price 10% higher than the market price the distributor pays for the
beans. The current market price is $0.47 per pound for Brazilian Natural and $0.62 per pound for
Colombian Mild. The compositions of each coffee blend are as follows:

Blend
Bean Regular DeCaf
Brazilian Natural 75% 40%
Colombian Mild 25% 60%

Romans sells the Regular blend for $3.60 per pound and the DeCaf blend for $4.40 per pound.
Romans would like to place an order for the Brazilian and Colombian coffee beans that will
enable the production of 1000 pounds of Romans Regular coffee and 500 pounds of Romans
DeCaf coffee. The production cost is $0.80 per pound for the Regular blend. Because of the extra
steps required to produce DeCaf, the production cost for the DeCaf blend is $1.05 per pound.
Packaging costs for both products are $0.25 per pound.

Formulate a linear programming model that can be used to determine the pounds of Brazilian
Natural and Colombian Mild that will maximize the total contribution to profit.

***************************************************************************

Q. 5 In case of a tie between leaving variable, one option is to arbitrarily break the tie and
choose any one of the rows as the Pivot row. However, this method has a possibility that
Simplex will get into a loop, where iterations will keep on getting performed without any change
in Z.
Discuss what causes this loop, its implications, and suggest ways to resolve this loop problem.

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