Decision Making Model: End Term Project Integer Programming Problem

Decision Making Model
End Term Project

Integer Programming Problem
Submitted To:
Prof Hitesh Arora
Date of Submission: 10 September
2015
Submitted By:
Chiranjeev Sethi 241040
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CONTENT
Theory...............................................................................................3
Case...................................................................................................4
Solution.............................................................................................6
References.........................................................................................9
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THEORY
An integer programming problem is a mathematical optimization or feasibility program in
which some or all of the variables are restricted to be integers. In many settings the term
refers to integer linear programming (ILP), in which the objective function and the
constraints (other than the integer constraints) are linear.
An integer linear program in canonical form is expressed as:
,
and an ILP in standard form is expressed as
where the entries of

and are integer. Note that similar to linear programs, ILPs not in
standard form can be converted to standard form by eliminating inequalities by introducing
slack variables and replacing variables that are not sign-constrained with the difference of
two sign-constrained variables.
There are two main reasons for using integer variables when modelling problems as a linear
program:
1. The integer variables represent quantities that can only be integer. For example, it is
not possible to build 3.7 cars.
2. The integer variables represent decisions and so should only take on the value 0 or 1 .
The cost of added modelling flexibility provided by integer programming is that problems
involving integer variables can be much more difficult to solve. An all integer linear
programming with less than 100 variables can be extremely difficult to solve. It is in fact NPhard. More important, perhaps, is the fact that the integer programs that can be solved to
provable optimality in reasonable time are much smaller in size than their linear
programming counterparts.
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CASE
A field for the use of Integer programming is for the optimal mix of products to manufacture.
A company must meet a myriad of constraints, ranging from financial concerns to sales
demand to material to union labor demands. Its primary goal is to generate the largest profit
possible.
Pioneer in Fashion Pvt. ltd is a manufacturer of export quality wear, it produces varieties of
garments for ladies.
It primarily produces 4 types of garments
Silk scarves
Polyester pants
Polyester-cotton blend jumpsuits
Silk-cotton blend dresses
The following table illustrates the cost and availability (per monthly production planning
period) of the three types of materials used in the production process:
MATERIAL
COST PER METRE
Silk
Polyester
Cotton
250
100
150
MATERIAL AVAILABLE PER

MONTH(metres)
120
300
160
The firm has fixed contracts with several major garment store chains to supply these ladies
wear. The contract requires that Pioneer in Fashion Pvt. ltd supply a minimum quantity of
each type of garment but allow for a large demand if Pioneer in Fashion Pvt. ltd chooses to
meet that demand.
The following table two summarizes the contract demand for each of the 4 styles of garments,
the miscellaneous expense per garment, the selling price per garment, and the fabric
requirement of each variety. Pioneer in Fashion Pvt. Ltd goal is to maximize its monthly
profit. It must decide upon a policy for product mix.
GARMENT TYPE
Silk Shirt
Trousers
Poly Silk Ladies Tops
Cotton Silk Suits
MONTHLY CONTRACT
MINIMUM
500
1,000
1,300
500
MONTHLY DEMAND
700
1,400
1,600
850
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GARMENT
TYPE
Silk Shirt
Trousers
Poly Silk
Ladies Tops
Cotton Silk
Suits
MISC.
EXPENSE
PER
GARMENT
80
86
134
SELLING
PRICE
PER
GARMEN
T
520
575
950
MATERIAL
REQUIRED
PER
GARMENT
(metres)
1.15
2.00
2.75
177.5
1200
2.25
MATERIAL
REQUIREMENTS
100% silk
100% polyester
50% polyester- 50%
cotton
60% silk40% cotton
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SOLUTION
In formulating this problem, the objective is to maximize profit there are 3 constraints (1 for
each material) indicating that the amount of silk, polyester, and cotton cannot exceed the
amount that is available. There are 4 constraints (1 for each type of garment) that specify that
the number of Silk Shirt, Trousers, Poly Silk Ladies Tops and Cotton Silk Suits produced
must be at least the minimum contract amount. There are 4 more constraints (1 for each type
of garment) that indicate that the number of each of these garments produced cannot exceed
the monthly demand.
The variables are defined as

X1= Number of Silk Shirt produced per month
X2= Number of Trousers produced per month
X3= Number of Poly Silk Ladies Tops produced per month
X4= Number of Cotton Silk Suits dresses produced per month
Now we first must establish the cost price for each type of garment:
1. The Silk Shirt requires 1.15 metre of silk, at a cost rs.250 per metre. The misc. cost
for this garment is rs.180.
Hence total cost= 1.15*250+80=367.5
2. The Trousers requires 2.00 metre of silk, at a cost rs.100 per metre. The misc. cost for
this garment is rs.86.
Hence total cost= 2.00*100+86=286
3. The Poly Silk Ladies Tops requires 1.375 metre of polyester, at a cost of rs.100 per
metre and 1.375 metre of cotton, at a cost rs.150 per metre. The misc. cost for this
garment is rs.134.
Hence total cost= 1.375*100+1.375*150+134=477.75
4. The Cotton Silk Suits requires 1.35 metre of silk, at a cost rs,250 per metre and 0.9
metre of cotton, at a cost rs.150 per metre. The misc. cost for this garment is rs.177.5.
Hence total cost= 1.35*250+0.9*150+177.5=650
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Now we evaluate the profit for each type of garment:

GARMENT TYPE
Silk Shirt
Trousers
Poly Silk Ladies
Tops
Cotton Silk Suits
SELLING PRICE
PER GARMENT
520
575
950
COST PRICE PER

GARMENT
367.5
286
477.75
PROFIT PER
GARMENT
152.5
289
472.25
1200
650
550
The objective function may now be stated as:

Maximize profit= 152.5X1+289X2+472.25X3+550X4
Subject to the following constraints:
0.125X1+0.066X4<=120 (metres of silk)
0.08X2+0.05X3<=300 (metres of polyester)
0.05X3+0.044X4<=160 (metres of cotton)
X1>=500 (contract minimum for Silk Shirt)
X1<=700 (monthly demand for Silk Shirt)
X2>=1000 (contract minimum for Trousers)
X2<=1400 (monthly demand for Trousers)
X3>=1300 (contract minimum for Poly Silk Ladies Tops)
X3<=1600 (monthly demand for Poly Silk Ladies Tops)
X4>=500 (contract minimum for Cotton Silk Suits)
X4<=850 (monthly demand for Cotton Silk Suits)
X1,X2,X3,X4,>=0
(non-negativity constraints)
X1,X2,X3,X4 are integers
Using Excel and its solver command, the computer generated optimal solution is as follows:
X1= Number of Silk Shirt produced per month=511
X2= Number of Trousers produced per month=1400
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X3= Number of Poly Silk Ladies Tops produced per month=1600

X4= Number of Cotton Silk Suits produced per month=850
Maximum Profit=152.5*511+289*1400+472.5*1600+550*850=1705628
Optimal SolutionHence we see that the Optimal solution would be to produce 511 silk shirts, 1400 trousers,
1600 polyester-cotton tops and 850 silk-cotton suits. Total Profit is Rs.17,05,628 per
production period.
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Decision Making Model: End Term Project Integer Programming Problem

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Decision Making Model

End Term Project

Chiranjeev Sethi 241040

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where the entries of

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COST PER METRE

MATERIAL AVAILABLE PER

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The variables are defined as

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Now we evaluate the profit for each type of garment:

COST PRICE PER

The objective function may now be stated as:

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X3= Number of Poly Silk Ladies Tops produced per month=1600

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