Module 5

Optimization Techniques
Syllabus
Linear programming, mathematical formulation of linear programming problems (LPP), graphical method,
Simplex and Revised Simplex Method.

Optimization is a technique of obtaining the best results under the given circumstances.
Optimization means minimization or maximization.

Linear programming is a widely used mathematical modelling technique developed to help decision
makers in planning and decision making regarding optimal use of resources.
General Mathematical Model of Linear Programming Problem
LPP is a problem of optimization (maximization or minimization) of a linear function (profit, sales, cost etc.) subject to a set of
linear constraints.
Here, the function Z which is being optimized is called objective function.
Thus, a general LPP is,
Optimize (Max. or Min.) 𝑍 = 𝑐1 𝑥1 + 𝑐2 𝑥2 +. . . +𝑐𝑛 𝑥𝑛 (Objective function)
Subject to the linear constraints.
𝑎11 𝑥1 + 𝑎12 𝑥2 +. . . +𝑎1𝑛 𝑥𝑛 ≤, =, ≥ 𝑏1
𝑎21 𝑥1 + 𝑎22 𝑥2 +. . . +𝑎2𝑛 𝑥𝑛 ≤, =, ≥ 𝑏2
. . . .
. . . . (Constraints)
. . . .

𝑎𝑚1 𝑥1 + 𝑎𝑚2 𝑥2 +. . . . 𝑎𝑚𝑛 𝑥𝑛 (≤, =, ≥)𝑏𝑚

and 𝑥1 , 𝑥2 . . . 𝑥𝑛 ≥ 0 (Non negativity conditions)
Objective Function
The function 𝑍 = 𝑐1 𝑥1 + 𝑐2 𝑥2 + ⋯ + 𝑐𝑛 𝑥𝑛 which is to be optimized (maximized or minimized) is called
objective function.

Decision Variables
The variables 𝑥1 , 𝑥2 … 𝑥𝑛 whose values are to be determined are called decision variables.

Cost(profit) coefficients
The coefficients 𝑐1 , 𝑐2 , … 𝑐𝑛 are called cost (profit) coefficients.

Requirements
The constants 𝑏1 , 𝑏2 … 𝑏𝑛 are called requirements

Solution
A set of real values 𝑋 = (𝑥1 , 𝑥2 … 𝑥𝑛 ) which satisfies the constraint is called solution.
Problems on LPP Formulation:

Q.1. A manufacturer produces two types of models 𝑀1 and 𝑀2 . Each model of the type 𝑀1 requires 4
hours of grinding and 2 hours of polishing; whereas each model of the type 𝑀2 requires 2 hours of
grinding and 5 hours of polishing. The manufacturer has 2 grinders and 3 polishers. Each grinder works
40 hours a week and each polisher works for 60 hours a week. Profit on 𝑀1 model is Rs 3.00 and on
model 𝑀2 is Rs. 4.00. Whatever is produced in a week is sold in the market. How should the
manufacturer allocate his production capacity to the two types of models so that he may make the
maximum profit in a week? Formulate this as LPP.
Problems on LPP Formulation:

Q.2. A company manufactures two products A and B. These products are processed in the same
machine. It takes 10 minutes to process one unit of product A and 2 minutes for each unit of product B
and the machine operates for a maximum of 35 hours a week. Product A requires 1 kg and B requires
0.5 kg of raw material per unit, the supply of which is 600 kg per week. Market constraint on product B
is known to be minimum of 800 units every week. Product A costs Rs. 5 per unit and sold at Rs. 10.
Product B costs Rs. 6 per unit and can be sold in the market at a unit price of Rs. 8. Determine the number
of units of A and B to be produced per week to maximize the profit.
Problems on LPP Formulation:

Q.3. A paper mill produces two grades of paper namely X and Y. Owing to raw material restrictions, it
cannot produce more than 400 tons of grade X and 300 tons of grade Y in a week. There are 160
production hours in a week. It requires 0.2 and 0.4 hours to produce a ton of products X and Y,
respectively with corresponding profits of Rs. 200 and Rs. 500 per ton. Formulate the above as an LPP
to maximize profit and find the optimum product mix.
Problems on LPP Formulation:

Q.4. A person requires 10, 12 and 12 units of chemicals A, B and C, respectively for his garden. A liquid
product contains 5, 2 and 1 units of A, B and C, respectively, per unit. A dry product contains 1, 2 and 4
units of A, B and C per carton. If the liquid product is sold for Rs. 3 per jar and the dry product is sold for
Rs. 2 per carton, how many units of each product should be purchased, in order to minimize the cost
and meet the requirements?
Q.5. An electronic company is engaged in the production of two components 𝐶1 and 𝐶2
that are used in ratio sets. Each unit of 𝐶1 costs the company Rs.15 in wages and Rs.5 in
material, while each of 𝐶2 costs the company Rs.25 in wages and Rs 5 in material. The
company sells both products on one period credit terms, but the company’s labor and
material expenses must be paid in cash. The selling price of 𝐶1 is Rs. 30 per unit and of
𝐶2 it is Rs 70 per unit. Because of the company’s strong monopoly in these components,
it is assumed that the company can sell, at the prevailing prices, as many units as it
produces. The company’s production capacity is however, limited by two considerations.
First, at the beginning of period 1, the company has an initial balance of Rs. 4000(cash
plus bank credit plus collections from past credit sales). Second, the company has, in
each period, 2000 hrs of machine time and 1400 hrs of assembly time. The production
of each 𝐶1 requires 3 hrs of machine time and 2 hrs of assembly time, whereas the
production of each 𝐶2 requires 2 hrs of machine time and 3 hrs of assembly time.
Formulate an LPP to maximize profit.
Problems on LPP Formulation:
Q.6. A manufacturing company is engaged in producing three types of products: A, B and C. The
production department produces, each day, components sufficient to make 50 units of A, 25 units of B
and 30 units of C. The management is confronted with the problem of optimizing the daily production
of the products in the assembly department, where only 100 man-hours are available daily for
assembling the products. The following additional information is available:
Type of a Profit Contribution per Assembly Time per
Product Unit of Product (Rs) Product (hrs.)
A 12 0.8
B 20 1.7
C 45 2.5
The Company has a daily order commitment for 20 units of Products A and a total of 15 units of products
B and C. Formulate this problem as an LP model so as to maximize the total profit.
Q.7. A retail store in Des Moines, Iowa, receives shipments of a particular product from
Kansas City and Minneapolis. Let
x=no of units of the product received from Kansas City
y= no of units of the product received from Minneapolis
(a) Write an expression for the total number of units of the product received by the retail store
in Des Moines.
(b) Shipments from Kansas City cost $0.20 per unit, shipment from Minneapolis cost $0.25
per unit. Develop an objective function representing the total cost of shipments to Des
Moines.
(c) Assuming the monthly demand at the retail store is 5000 units, develop a constraint that
requires 5000 units to be shipped to Des Moines.
(d) No more than 4000 units can be shipped from Kansas City, and no more than 3000 units
can be shipped from Minneapolis in a month. Develop constraints to model this situation.
(e) Of course, negative amounts cannot be shipped. Combine the objective function and
Constraints developed to state a mathematical model for satisfying the demand at the Des
Moines retail store at minimum cost.
Feasible Solution
A set of real values 𝑋 = (𝑥1 , 𝑥2 … 𝑥𝑛 ) which
(i) Satisfies the constraint and
(ii) Satisfies the non-negativity condition is called feasible solution.

Optimal Solution
A set of real values 𝑋 = (𝑥1 , 𝑥2 … 𝑥𝑛 ) which
(i) Satisfies the constraint
(ii) Satisfies the non-negativity condition and
(iii) Optimizes the objective function is called optimal solution
 Graphical Method
The linear programming problems with two decision variables can be easily
solved by graphical method.
Working Procedure
Step 1: Consider each inequality constraint as an equation
Step2: Plot each equation on the graph, as each equation will geometrically
represent a straight line.
Step 3: Mark the region as follows. For the inequality constraint ≥ sign (or ≤
sign), the region above (or below)the line in the first quadrant is shaded. The
points lying in the common region will satisfy all the constraints simultaneously.
The common region thus obtained is called the feasible region.
Step 4: Identify the corner points of the feasible region.
Step 5: Evaluate the value of objective function Z at each corner point and
identify the maximum or minimum value of objective function.
Q1. Solve the following LPP by graphical method
Minimize 𝑧 = 20𝑥1 + 10𝑥2
Subject to 𝑥1 + 2𝑥2 ≤ 40
3𝑥1 + 𝑥2 ≥ 30
4𝑥1 + 3𝑥2 ≥ 60
𝑥1 , 𝑥2 ≥ 0
Q2. Solve the following LPP by graphical method
Maximize 𝑧 = 5𝑥1 + 7𝑥2
Subject to 𝑥1 + 𝑥2 ≤ 4
3𝑥1 + 8𝑥2 ≤ 24
10𝑥1 + 7𝑥2 ≤ 35
𝑥1 , 𝑥2 ≥ 0
Q3. Solve the following LPP by graphical method
Maximize 𝑧 = 3𝑥1 + 2𝑥2
Subject to 𝑥1 − 𝑥2 ≥ 1
𝑥1 + 𝑥2 ≥ 3
𝑥1 , 𝑥2 ≥ 0
Q4. Solve the following LPP by graphical method
Maximize 𝑧 = 𝑥1 + 𝑥2
Subject to 𝑥1 + 𝑥2 ≤ 1
−3𝑥1 + 𝑥2 ≥ 3
𝑥1 , 𝑥2 ≥ 0
Q5. Solve the following LPP by graphical method
Maximize 𝑧 = 100𝑥1 + 40𝑥2
Subject to 5𝑥1 + 2𝑥2 ≤ 1000
3𝑥1 + 2𝑥2 ≤ 900
𝑥1 + 2𝑥2 ≤ 500
𝑥1 , 𝑥2 ≥ 0
Simplex Method
This is an analytical tool which was developed by Gregory Dantzig of
U.K. in 1947 to solve LPP. The simplex method will be especially useful
because the Graphical Method can be used only when there are not
more than two variables, which limits its usage.
Standard form of LPP for applying Simplex Method

1. Objective function should always be of maximization type.

If the objective function is of minimization type, it is converted to maximization by
multi[plying by -1 on both the sides.
2. All the constraints should be converted into equations by applying some techniques
3. The R.H.S of all inequalities should be non-negative
4. All variables must have non-negative values
5. All the constraints should be of ≤ sign to solve by simplex method. If not the LPP has to
be solved by Big M method
Slack Variables ( ≤ )
In an optimization problem, a slack variable is a variable that is added to an inequality
constraint to transform it into an equality. It is used for less than or equal inequality
constraints.

Surplus Variables (≥)

A variable which is added to an inequality constraint to transform it into an equality. It is
utilized for greater than or equal inequality constraints.

Artificial Variable (≥ 𝑜𝑟 =)
The artificial variable refers to the kind of variable which is introduced in the linear
program model to obtain the initial basic feasible solution. It is utilized for the equality
constraints and for the greater than or equal inequality constraints.
Write the standard forms of the following LPs
Write the standard form of the following LPs
Simplex Algorithm to solve LPP
STEP 1: Given an L.P.P with decision variables 𝑥1 , 𝑥2 , 𝑥3 , … … . . , 𝑥𝑛 to maximize or
minimize the objective function as

𝑧 = 𝑐1 𝑥1 + 𝑐2 𝑥2 + ⋯ … . . +𝑐𝑛 𝑥𝑛
Subject to m linear constraints,
𝑎11 𝑥1 + 𝑎12 𝑥2 + ⋯ … … . . +𝑎1𝑛 𝑥𝑛 (≤, =, ≥)𝑏1

𝑎21 𝑥1 + 𝑎22 𝑥2 + ⋯ … … . . +𝑎2𝑛 𝑥𝑛 (≤, =, ≥)𝑏2

………………………………………………………
𝑎𝑚1 𝑥1 + 𝑎𝑚2 𝑥2 + ⋯ … … . . +𝑎𝑚𝑛 𝑥𝑛 (≤, =, ≥)𝑏𝑚
And non negativity restrictions 𝑥1 ≥ 0, 𝑥2 ≥ 0 … … … , 𝑥𝑛 ≥ 0.

STEP 2: Check whether the objective function of the given LPP is to be maximized or
minimized. If it is to be minimized then we convert it into a problem of maximization
by
𝑀𝑖𝑛 𝑍 = −𝑀𝑎𝑥(−𝑍)
STEP 3: Check whether all 𝑏𝑗 (𝑗 = 1,2, … . . 𝑚) are positive. If any 𝑏𝑗 is negative then multiply the inequation of
the constraint by -1 so as to get all 𝑏𝑗 to be positive.
STEP 4: Express the problem in standard form by introducing slack variables to convert the inequality constraints
into equations.
STEP 5: The initial simplex table is given below
𝐶𝑗 𝐶1 𝐶2 ……………. 𝐶𝑛 0 0 0 ……………………..0

Basic 𝑪𝑩 𝒙𝟏 𝒙𝟐 …….……….. 𝒙𝒏 𝒔𝟏 𝒔𝟐 𝒔𝟑 ………………………. 𝒔𝒏 RHS / Ratio

Variable Constant/ 𝒃𝒋 /𝒙𝒋
𝒙𝑩 𝒃𝒋
𝒔𝟏 𝑪𝑩1 𝑎11 𝑎12 ………………. 𝑎1𝑛 1 0 0…………..................0 𝑏1
𝒔𝟐 𝑪𝑩2 𝑎21 𝑎22 ………………. 𝑎2𝑛 0 1 0……………………….....0 𝑏2
𝒔𝟑 𝑪𝑩3 𝑎31 𝑎32 ………………. 𝑎3𝑛 0 0 1…………………...........0 𝑏3
…………… ………………… ……………………………………………………………………………………………………………… ………………
…………… ………………… .. ………………
………… ……………… ………………………………………………………………………………………………………………

𝒔𝒏 𝑪𝑩n 𝑎𝑚1 𝑎𝑚2 ………….... 𝑎𝑚𝑛 0 0 0…………....................1 𝑏𝑛

𝑪𝒋 : Coefficients of all the variables in objective function
𝑪𝑩 : Coefficients of basic variables in objective function

STEP 6: Compute Z equation using the relation

𝒁𝒋 = ෍ 𝑪𝑩 𝒙𝒋 𝒂𝒏𝒅 𝒁𝒋 − 𝑪𝒋

1) Find most negative value of the 𝒁𝒋 − 𝑪𝒋 and proceed step 7.

2) If there is no negative element in 𝒁𝒋 −𝑪𝒋 OR 𝒁𝒋 −𝑪𝒋 ≥ 𝟎 then the solution stage is reached.
The solution is nothing but the values in 𝒃𝒋 coilumn corresponding to the basic variables at the solution
stage.

STEP 7: Find the key column, key row and key element as follows
Entering column or Key column: The column in which the least negative element of 𝒁𝒋 −𝑪𝒋 is present.
Leaving row or key row : The row in which the least positive ratio is present
𝑹𝑯𝑺 𝒐𝒓 𝒄𝒐𝒏𝒔𝒕𝒂𝒏𝒕𝒔 𝒃𝒋
𝑹𝒂𝒕𝒊𝒐 = 𝑶𝒓
𝑲𝒆𝒚 𝒄𝒐𝒍𝒖𝒎𝒏 𝒄𝒐𝒆𝒇𝒇𝒊𝒄𝒊𝒆𝒏𝒕 𝒙𝒋
If there is no least positive ratio then the solution for the LPP is unbounded
Key Element or pivot: The element which is present at the intersection of key column and key row
STEP 8: First Iteration: Draw a simplex table by introducing the new variable and
dropping the leaving variable. The new first row is found as follows

𝑲𝒆𝒚 𝒓𝒐𝒘
𝑵𝒆𝒘 𝒇𝒊𝒓𝒔𝒕 𝒓𝒐𝒘 =
𝑷𝒊𝒗𝒐𝒕
𝑬𝒍𝒆𝒎𝒆𝒏𝒕 𝒐𝒇 𝒐𝒍𝒅 𝒓𝒐𝒘
𝑵𝒆𝒘 𝒔𝒆𝒄𝒐𝒏𝒅 𝒓𝒐𝒘 = 𝑶𝒍𝒅 𝒓𝒐𝒘 − 𝑵𝒆𝒘 𝒇𝒊𝒓𝒔𝒕 𝒓𝒐𝒘 ×
𝒊𝒏 𝒌𝒆𝒚 𝒄𝒐𝒍𝒖𝒎𝒏

STEP 9: Go to Step 6 and repeat the procedure till the solution stage is reached
Q1. Solve the following LPP by simplex method
Max. 𝑧 = 3𝑥1 + 2𝑥2
subject to 𝑥1 + 𝑥2 ≤ 4
𝑥1 − 𝑥2 ≤ 2
and 𝑥1 , 𝑥2 ≥ 0
Q2. Solve the following LPP by simplex method
Max. 𝑧 = 4𝑥1 − 2𝑥2 − 𝑥3
subject to 𝑥1 + 𝑥2 + 𝑥3 ≤ 3
2𝑥1 + 2𝑥2 + 𝑥3 ≤ 4
𝑥1 − 𝑥2 ≤ 0
and 𝑥1 , 𝑥2 , 𝑥3 ≥ 0
Practice Problems

• Problem1

• Ans1

• Problem2

• Ans2
Practice Problems

• Problem3

• Ans3

• Problem4

• Ans4
Minimization Case
A minimizing LPP is converted in to an equivalent maximization problem.
Minimizing the given objective function z is equivalent to maximizing –z under the
the same constraints and

𝑀𝑖𝑛. 𝑧 = −(𝑀𝑎𝑥. 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 − 𝑧)

Q1. Solve the following LPP by simplex method
Min. 𝑧 = −2𝑥1 − 3𝑥2 − 𝑥3
subject to 𝑥1 + 2𝑥2 − 2𝑥3 ≤ 5
3𝑥1 − 𝑥2 − 𝑥3 ≤ 2
and 𝑥1 , 𝑥2 , 𝑥3 ≥ 0
Q2. Solve the following LPP by simplex method
Min. 𝑧 = 𝑥1 − 3𝑥2 + 2𝑥3
subject to 3𝑥1 − 𝑥2 + 2𝑥3 ≤ 7
−2𝑥1 + 4𝑥2 ≤ 12
−4𝑥1 + 3𝑥2 + 8𝑥3 ≤ 10
and 𝑥1 , 𝑥2 , 𝑥3 ≥ 0
Q3. Solve the following LPP by simplex method
Min. 𝑧 = 60𝑥1 + 50𝑥2
subject to 𝑥1 + 2𝑥2 ≤ 40
3𝑥1 + 2𝑥2 ≤ 60
and 𝑥1 , 𝑥2 ≥ 0