PROBLEM 1

Southern Sporting Goods Company makes basketballs and footballs. Each product is
produced from two resources—rubber and leather. The resource requirements for each
product and the total resources available are as follows:

Resource requirements per unit

Each basketball produced results in a profit of $12, and each football earns $16 in profit.

Required:
1. Formulate a linear programming model to determine the number of basketballs
and footballs to produce in order to maximize profit.
2. Solve the model formulated for Southern Sporting Goods Company using the
computer.
3. What would be the effect on the optimal solution if the profit for a basketball
changed from $12 to $13? What would be the effect if the profit for a football
changed from $16 to $15?
4. What would be the effect on the optimal solution if 500 additional pounds of
rubber could be obtained? What would be the effect if 500 additional square feet
of leather could be obtained?
5. Using the computer, determine the shadow prices for the resources and explain
their meaning.

PROBLEM 2
Irwin Textile Mills produces two types of cotton cloth—denim and corduroy. Corduroy is
a heavier grade of cotton cloth and, as such, requires 7.5 pounds of raw cotton per
yard, whereas denim requires 5 pounds of raw cotton per yard. A yard of corduroy
requires 3.2 hours of processing time; a yard of denim requires 3.0 hours. Although the
demand for denim is practically unlimited, the maximum demand for corduroy is 510
yards per month. The manufacturer has 6,500 pounds of cotton and 3,000 hours of
processing time available each month. The manufacturer makes a profit of $2.25 per
yard of denim and $3.10 per yard of corduroy. The manufacturer wants to know how
many yards of each type of cloth to produce to maximize profit.

Required:
1. Formulate a linear programming model for this problem.
2. Solve the model formulated for Irwin Textile Mills using the computer.
3. How much extra cotton and processing time are left over at the optimal solution?
Is the demand for corduroy met?
 4. What is the effect on the optimal solution if the profit per yard of denim is
increased from $2.25 to $3.00? What is the effect if the profit per yard of
corduroy is increased from $3.10 to $4.00?
5. What would be the effect on the optimal solution if Irwin Mills could obtain only
6,000 pounds of cotton per month?
6. If Irwin Mills can obtain additional cotton or processing time, but not both, which
should it select? How much? Explain your answer.
7. Identify the sensitivity ranges for the objective function coefficients and for the
constraint quantity values. Then explain the sensitivity range for the demand for
corduroy.

PROBLEM 3
United Aluminum Company of Cincinnati produces three grades (high, medium, and
low) of aluminum at two mills. Each mill has a different production capacity (in tons per
day) for each grade, as follows:
Mill
Aluminum Grade 1 2
High 6 2
Medium 2 2
Low 4 10

The company has contracted with a manufacturing firm to supply at least 12 tons of
high-grade aluminum, 8 tons of medium-grade aluminum, and 5 tons of low-grade
aluminum. It costs United $6,000 per day to operate mill 1 and $7,000 per day to
operate mill 2. The company wants to know the number of days to operate each mill in
order to meet the contract at the minimum cost.

Required:
1. Formulate a linear programming model for this problem.
2. Solve the linear programming model formulated for United Aluminum Company
by using the computer.
3. Identify and explain the shadow prices for each of the aluminum grade contract
requirements.
4. Identify the sensitivity ranges for the objective function coefficients and the
constraint quantity values.
5. Would the solution values change if the contract requirements for high-grade
aluminum were increased from 12 tons to 20 tons? If yes, what would the new
solution values be?
PROBLEM 4
The manager of a Burger Doodle franchise wants to determine how many sausage
biscuits and ham biscuits to prepare each morning for breakfast customers. The two
types of biscuits require the following resources:

Biscuit Labor (hr) Sausage (lb) Ham (lb) Flour (lb)

The franchise has 6 hours of labor available each morning. The manager has a contract
with a local grocer for 30 pounds of sausage and 30 pounds of ham each morning. The
manager also purchases 16 pounds of flour. The profit for a sausage biscuit is $0.60;
the profit for a ham biscuit is $0.50. The manager wants to know the number of each
type of biscuit to prepare each morning in order to maximize profit.

Required:
1. Formulate a linear programming model for this problem.
2. Solve the linear programming model developed for the Burger Doodle restaurant
by using the computer.
3. Identify and explain the shadow prices for each of the resource constraints.
4. Which of the resources constraints profit the most?
5. Identify the sensitivity ranges for the profit of a sausage biscuit and the amount of
sausage available. Explain these sensitivity ranges.
6. How much extra sausage and ham is left over at the optimal solution point? Is
there any idle labor time?
7. What would the solution be if the profit for a ham biscuit were increased from
$0.50 to $0.60?
8. What would be the effect on the optimal solution if the manager could obtain 2
more pounds of flour?

PROBLEM 5
Rucklehouse Public Relations has been contracted to do a survey following an election
primary in New Hampshire. The firm must assign interviewers to conduct the survey by
telephone or in person. One person can conduct 80 telephone interviews or 40 personal
interviews in a single day. The following criteria have been established by the firm to
ensure a representative survey:
o At least 3,000 interviews must be conducted.
o At least 1,000 interviews must be by telephone.
o At least 800 interviews must be personal.

An interviewer conducts only one type of interview each day. The cost is $50 per day for
a tele- phone interviewer and $70 per day for a personal interviewer. The firm wants to
know the mini- mum number of interviewers to hire in order to minimize the total cost of
the survey.
Required:
1. Formulate a linear programming model for this problem.
2. Solve the linear programming model formulated for Rucklehouse Public
Relations by using the computer.
3. If the firm could reduce the minimum interview requirement for either telephone
or personal interviews, which should the firm select? How much would a
reduction of one interview in the requirement you selected reduce total cost?
Solve the model again, using the computer, with the reduction of this one
interview in the constraint requirement to verify your answer.
4. Identify the sensitivity ranges for the cost of a personal interview and the number
of total interviews required.
5. Does the firm conduct any more telephone and personal interviews than are
required, and if so, how many more?
6. What would be the effect on the optimal solution if the firm was required by the
client to in- crease the number of personal interviews conducted from 800 to a
total of 1,200?

PROBLEM 6
Alexis Harrington received an inheritance of $95,000, and she is considering two
speculative investments—the purchase of land and the purchase of cattle. Each
investment would be for 1 year. Under the present (normal) economic conditions, each
dollar invested in land will return the principal plus 20% of the principal; each dollar
invested in cattle will return the principal plus 30%. However, both investments are
relatively risky. If economic conditions were to deteriorate, there is an 18% chance she
would lose everything she invested in land and a 30% chance she would lose
everything she invested in cattle. Alexis does not want to lose more than $20,000 (on
average). She wants to know how much to invest in each alternative to maximize the
cash value of the investments at the end of 1 year.

Required:
1. Formulate a linear programming model for this problem.
2. Solve the linear programming model formulated for Alexis Harrington by using
the computer.
3. How much would the return for cattle have to increase in order for Alexis to invest
only in cattle?
4. Should all of Alexis’s inheritance be invested according to the optimal solution?
5. How much “profit” would the optimal solution earn Alexis over and above her
investment?
6. If Alexis decided to invest some of her own savings along with the money from
her inheritance, what return would she realize for each dollar of her own money
that she invested? How much of her own savings could she invest before this
return would change?
7. If the risk of losing the investment in land increased to 30%, how would this
change the optimal investment mix?
PROBLEM 7

Mossaic Tiles, Ltd.

Gilbert Moss and Angela Pasaic spent several summers during their college years
working at archaeological sites in the Southwest. While at those digs, they learned how
to make ceramic tiles from local artisans. After college they made use of their college
experiences to start a tile manufacturing firm called Mossaic Tiles, Ltd. They opened
their plant in New Mexico, where they would have convenient access to a special clay
they intend to use to make a clay derivative for their tiles. Their manufacturing operation
consists of a few relatively simple but precarious steps, including molding the tiles,
baking, and glazing.

Gilbert and Angela plan to produce two basic types of tile for use in home bathrooms,
kitchens, sunrooms, and laundry rooms. The two types of tile are a larger, single-
colored tile and a smaller, patterned tile. In the manufacturing process, the color or
pattern is added before a tile is glazed. Either a single color is sprayed over the top of a
baked set of tiles or a stenciled pattern is sprayed on the top of a baked set of tiles.
The tiles are produced in batches of 100. The first step is to pour the clay derivative into
specially constructed molds. It takes 18 minutes to mold a batch of 100 larger tiles and
15 minutes to prepare a mold for a batch of 100 smaller tiles. The company has 60
hours available each week for molding. After the tiles are molded, they are baked in a
kiln: 0.27 hour for a batch of 100 larger tiles and 0.58 hour for a batch of 100 smaller
tiles. The company has 105 hours available each week for baking. After baking, the tiles
are either colored or patterned and glazed.

This process takes 0.16 hour for a batch of 100 larger tiles and 0.20 hour for a batch of
100 smaller tiles. Forty hours are available each week for the glazing process. Each
batch of 100 large tiles requires 32.8 pounds of the clay derivative to produce, whereas
each batch of smaller tiles requires 20 pounds. The company has 6,000 pounds of the
clay derivative available each week.

Mossaic Tiles earns a profit of $190 for each batch of 100 of the larger tiles and $240
for each batch of 100 smaller patterned tiles. Angela and Gilbert want to know how
many batches of each type of tile to produce each week to maximize profit. In addition,
they have some questions about resource usage they would like answered.

Required:
1. Formulate a linear programming model for Mossaic Tiles, Ltd., and determine the
mix of tiles it should manufacture each week.
2. Solve the linear programming model using the computer.
3. Determine the resources left over and not used at the optimal solution point.
4. Determine the sensitivity ranges for the objective function coefficients and
constraint quantity values.
5. For artistic reasons, Gilbert and Angela prefer to produce the smaller, patterned
tiles. They also believe that in the long run, the smaller tiles will be a more
 successful product. What must the profit be for the smaller tiles in order for the
company to produce only the smaller tiles?
6. Mossaic believes it may be able to reduce the time required for molding to 16
minutes for a batch of larger tiles and 12 minutes for a batch of smaller tiles. How
will this affect the solution?
7. The company that provides Mossaic with clay has indicated that it can deliver an
additional 100 pounds each week. Should Mossaic agree to this offer?
8. Mossaic is considering adding capacity to one of its kilns to provide 20 additional
glazing hours per week, at a cost of $90,000. Should it make the investment?
9. The kiln for glazing had to be shut down for 3 hours, reducing the available kiln
hours from 40 to 37. What effect will this have on the solution?