Terminology of solutions for a LP model:

A Solution
Any specifications of values of X1, X2, ………, Xn is
called a solution.

A Feasible Solution
Is a solution for which all the constraints are satisfied.

An Optimal Solution
Is a feasible solution that has the most favorable value
of the objective function (largest for maximize or
smallest for minimize).

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Note

•If there is exactly one optimal solution it must be a corner

point feasible solution.

•If there are multiple optimal solutions, then at least two

of them must be adjacent corner- point feasible
solutions.

Two corner-point feasible solutions are said to be

adjacent if the line segment connecting them lies on
the boundary of the feasible region (one of the
constraints).

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 Graphical Solution

Construction of the LP model

Example 1:
The Reddy Mikks Company

Reddy Mikks produces both interior and exterior

paints from two raw materials, M1&M2. The following
table provides the basic data of the problem.

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 A market survey indicates that the daily demand for interior
paint cannot exceed that of exterior paint by more than 1 ton.
Also, the maximum daily demand of interior paint is 2 ton.

Reddy Mikks wants to determine the optimum (best)

product mix of interior and exterior paints that maximizes the
total daily profit.

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Problem Formulation
Decision variables
X1= Tons produced daily of exterior paint.
X2= Tons produced daily of interior paint.
Objective Function
Maximize Z= 5 X1 + 4 X2
Constraints
6 X1 + 4 X2 <= 24
X1 + 2 X2 <=
- X1 + X2
6
<=
Any solution that satisfies all the constraints
1
of the model is
a feasible solution. For example, X1=3 tons and X2=1 ton is a
X2 <=
feasible solution. We have
X1, an infinite number of feasible
solutions, but we are interested
X2 in2 the optimum feasible
solution that yields the maximum total >=0profit.

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Graphical Solution

The graphical solution is easy only for two-variable problem

which rarely occurs. Yet, it can explain some of the
concepts behind the Algebraic solution (Simplex method)

The graphical solution includes two basic steps:

1. The determination of the solution space that defines

the feasible solutions that satisfy all the constraints.

2. The determination of the optimum

solution from among all the points in the
feasible solution space.

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.

ABCDEF consists of an infinite number of points; we need a

systematic procedure that identifies the optimum solutions. The
optimum solution is associated with a corner point of the
solution space.
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Notes:

Types of Constraints
1- Binding (Constraints that pass through the optimum
point) the ones that define the optimum
2- Non-binding(All other constraints are non-binding
3- Redundant( Constraints that do not form the feasible
solution space) far from the feasible space…
Constraints represent resources (M1, M2,,,,)
So, binding constraints correspond to “scarce”
resources
Non-binding correspond to “Abundant” resources
Scarce resources mean that they are totally consumed
at optimum…
Abundant: There is excess of each at optimum(not
totally consumed).
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 To determine the direction in which the profit function increases
we assign arbitrary increasing values of 10 and 15
5 X1 + 4 X2=10
And 5 X1 + 4 X2=15

The optimum solution is mixture of 3 tons of exterior and 1.5 tons

of interior paints will yield a daily profit of 21000$. 31 9
.

Sensitivity Analysis (Graphical)AFTER NEXT EXAMPLE

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.

Sensitivity Analysis (Graphical)AFTER NEXT EXAMPLE

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Sensitivity Analysis

Sensitivity Analysis answers the question “What If”. In other words, what
would happen if the RHS of the constraint is changed by a certain
amount?
How would that change affect the value of the objective function?

Types of Sensitivity Analysis

*Right Hand Side
*Objective Function Coefficients

Example for RHS: Let’s study the change in the RHS of constraint 1 (Raw
material 1)

To do so, let’s assume that the constraint does not exist,, and see how
this assumption affects the feasible solution space.
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RHS Sensitivity

It is clear that such an assumption will result in adding the triangle to the
right of CB to the feasible solution space. Thus, the corner point (6,0)
will be a new corner point(candidate optimum).

The above can be also performed through increasing the RHS of the
constraint 6x1+4x2<=24( (moving it to the right parallel to itself) until it
hits the last corner point (to become just redundant). This occurs when
the constraint passes through (6,0).

The RHS of the constraint when it passes through (6,0), becomes

6*6+4*0= 36,, which means that this constraint can be increased till it is
36. In other words, the maximum amount of increase is 36-24=12 tons.

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RHS Sensitivity (Constraint 1)

At this point where constraint 1 passes through (6,0), the value of the
objective function (5x1+4x2)=5*6+4*0=30.. This corresponds to an
increase of (30-21=9). (The optimum was z=21)

Here a new concept called the “unit worth””shadow price” or” dual cost”
of constraint 1(Raw material 1) is introduced

Unit worth= (maximum change in Z)/(maximum change in right hand side)

= (30-9)/(36-24)=9/12=(3/4)$/ton
Which means that an increase of one ton of raw material 1, would
increase the value of the objective function (z) by ($3/4),, but this is
applicable only within the maximum increase to the maximum decrease of
the raw material. The procedure above was to obtain the maximum
increase. As for the maximum decrease, the constraint will be decreased 14
Mamximum Decrease

So, substituting the coordinates of point “D”(2,2)( into constraint 1 yields

the following: 6*2+4*2=20,, The maximum decrease (change )will be (20-
24)=4 tons

Therefore the range for raw material one for which the use of unit worth is
applicable is RM1(min)<=RM1<=RM1(max)
20<=RM1<=36( The range for which the unit worth is applicable

Or 20-24<=ΔRM1<=36-24
-4<= Δ RM1<=12

This is the range for which the unit worth of (3/4) is applicable. The same can be
performed for all constraints…
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Priority of resource increase is based the unit worth of the resource.
Resources that have higher values of unit worth is given the priority to
increase.

Abundant resources (non binding constraints have “zero” unit worth..

This implies that it is not beneficial in terms of the objective function to
increase the amount of an abundant resource….

Objective function coefficients

The ratio of the objective function coefficients is given as follows
Optimum”C” is formed by the intersection of two binding constraints
6x1+4x2<=24, and x1+2x2<=6,,,, Therefore, the slope of the objective
function can vary between these two constraints.. So, if the objective 16
(1/2)<=(c1/c2)<=(6/4)

So, to study the change in the coefficient of x1”c1”, we need to keep the
value of c2 fixed =4 in this case..

So, (1/2)<=(c1/4)<=(6/4)….

Multiplying the inequality by 4,,,

2<=c1<=6…

Max allowable increase is 1(6-5) and allowable decrease is 3(5-2)…

The same can be done with constraint 2…Beyond this range, the values
of x and x2 will change….

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