Linear Programming
Excel Solver
Business Administration
EASTERN MEDITERRANEAN UNIVERSITYFAC
Faculty of Business and Economics
Department of Business Administration
FALL SEMESTER
MGMT 503 Managerial Economics
MBA
Practical Computing Classes
Fall Semester
Handout 8: An Application of Linear Programming
By
Excel Solver
Coordinator
Assoc. Prof Sami Fethi
Sami.fethi@emu.edu.tr
Instructor
Mr. Ali Mayboudi
ali.mayboudi@emu.edu.tr
1
Linear Programming
Excel Solver
Business Administration
We will use solver and some other functions within Excel to provide solutions for
the more complex management problems.
Tasks
1. Type a title at the top of the spreadsheet for the relevant data (see Data set 1,
on page 8) and apply the tip1: (A Product Mix Example)
2. Type a title at the top of the spreadsheet for the relevant data (see Data set 2,
on 9 ) and apply tip2: (A Diet Example)
3. Type a title at the top of the spreadsheet for the relevant data (see Data set 3,
on page 10 ) and apply tip3: (A Investment Example)
4. Type a title at the top of the spreadsheet for the relevant data (see Data set 4,
on page 11) and apply tip4: (A Marketing Example)
Tips for Tasks
1
a) The excel spreadsheet solution for this example is construct as in fig 1; b) in
turn, use the data information from the relevant spreadsheet and apply the
solver function . Your worksheet should appear as in fig1.
2
Linear Programming
Excel Solver
Business Administration
FIG1
2
The excel spreadsheet solution for this example is construct as in fig 2; b) in
turn, use the data information from the relevant spreadsheet and apply the
solver function. Your worksheet should appear as in fig 2.
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Linear Programming
Excel Solver
Business Administration
FIG2
3
The excel spreadsheet solution for this example is construct as in fig 3; b) in
turn, use the data information from the relevant spreadsheet and apply the
solver function. Your worksheet should appear as in fig 3. The output results are
displayed in fig 4.
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Linear Programming
Excel Solver
Business Administration
FIG3
FIG4
4
The excel spreadsheet solution for this example is construct as in figs 5, 6, 7and
8; b) in turn, use the data information from the relevant spreadsheet and apply
the solver function. Your worksheet should appear as in fig 5. The output results
are displayed in fig 9.
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Linear Programming
Excel Solver
Business Administration
FIG5
FIG6
FIG7
6
Linear Programming
Excel Solver
Business Administration
FIG8
FIG9
7
Linear Programming
Excel Solver
Business Administration
Data Set 1:
Processing
Time (hr)
Per dozen
Cost
($)
per
dozen
Profit
($)
per
dozen
Sweatshirt - F
0.10
36
90
Sweatshirt –
B/F
0.25
48
125
T-shirt - F
0.08
25
45
T-shirt - B/F
0.21
35
65
Decision Variables:
x1 = sweatshirts, front printing
x2 = sweatshirts, back and front printing
x3 = T-shirts, front printing
x4 = T-shirts, back and front printing
Objective Function:
Maximize Z = $90x1 + $125x2 + $45x3 + $65x4
Model Constraints:
0.10x1 + 0.25x2+ 0.08x3 + 0.21x4  72 hr
3x1 + 3x2 + x3 + x4  1,200 boxes
$36x1 + $48x2 + $25x3 + $35x4  $25,000
x1 + x2  500 dozen sweatshirts
x3 + x4  500 dozen T-shirts
 Four-product T-shirt/sweatshirt manufacturing company.
Must complete production within 72 hours
Truck capacity = 1,200 standard sized boxes.
Standard size box holds12 T-shirts.
One-dozen sweatshirts box is three times size of standard box.
$25,000 available for a production run.
500 dozen blank T-shirts and sweatshirts in stock.
How many dozens (boxes) of each type of shirt to produce?
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Linear Programming
Excel Solver
Business Administration
Data Set 2:
Breakfast Food
Fat Cholesterol Iron Calcium Protein Fiber Cost
Cal (g)
(mg)
(mg)
(mg)
(g)
(g)
($)
1. Bran cereal (cup)
90 0
0
6
20
3
5
0.18
2. Dry cereal (cup)
110 2
0
4
48
4
2
0.22
3. Oatmeal (cup)
100 2
0
2
12
5
3
0.10
4. Oat bran (cup)
90 2
0
3
8
6
4
0.12
5. Egg
75 5
270
1
30
7
0
0.10
6. Bacon (slice)
35 3
8
0
0
2
0
0.09
7. Orange
65 0
0
1
52
1
1
0.40
8. Milk-2% (cup)
100 4
12
0
250
9
0
0.16
9. Orange juice (cup) 120 0
0
0
3
1
0
0.50
10. Wheat toast (slice)
65 1
0
1
26
3
3
0.07
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Linear Programming
Excel Solver
Business Administration
Data Set 3:
where
x1 = amount invested in municipal bonds ($)
x2 = amount invested in certificates of deposit ($)
x3 = amount invested in treasury bills ($)
x4 = amount invested in growth stock fund($)
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Linear Programming
Excel Solver
Business Administration
Data Set 4:
11