UNIVERSITY OF RUHUNA
DEPARTMENT OF MATHEMATICS
B.Sc.Hons Degree in Financial Mathematics and
Industrial Statistics
MSF1222: Operations Research II
Tutorial No: 01 Semester II, 2023
Instructions:
Turn in Problems are: #3 and #4.
Submit answer sheets on or before 09/05/2023.
1. A small paint company manufactures two types of paint latex and enamel production. The
company uses 10 hours of labour to produce 100 gallons of latex, and 15 hours of labour
to produce 100 gallons of enamel. The company has 40 hours of daily labor and 30 hours
of overtime labour available each week. Each paint generalizes a profit at the rate of one
dollar per gallon. The company has the following objectives listed in decreasing priority.
I Avoid the used of overtime.
II Achieve a weekly profit of $1000.
III Produce at least 700 gallons of enamel paint in each week.
Formulated the Goal Programming Model.
2. An electronics company produces two types of television sets, color and black-and-white.
The production of a color set requires 10 hours of skilled and 100 hours of unskilled labor.
The production of a black-and-white set requires 5 hours of skilled and 150 hours of unskilled
labor. The company has 100 hours of skilled labor and 1,500 hours of unskilled labor
normally available per month for the production of television sets. The maximum number
black-and-white and color sets that can be sold each month are 45 and 70, respectively. The
profit margin from the sale of a color set is $20, whereas it is $15 from a black-and-white
set. The company has set the following goals:
I Avoid the over utilization of skilled labor since it is hard to obtain in the labor market.
II Minimize the underutilization of unskilled labor.
III Meet the demand as much as possible.
IV Limit over utilization of unskilled labor to 100 hours.
Formulate the above as a goal programming problem.
3. A department store plans to schedule its annual advertising. The total budget is set at
$200,000. The store can purchase local radio spots at $100 per spot, local television spots
at $500 per spot and local newspaper advertising at $200 per ad. The payoff from each
advertising medium is a function of its audience size and audience characteristics. The
generally accepted objective criterion for advertising is audience points, reflected in the
following table:
Medium Points
Radio 30 per spot
Television 150 per spot
Newspaper 150 per ad
The president of the firm has established the following goals for the campaign:
I The total budget should not exceed $200,000.
II Meet the contract with the local television station that requires that the firm spend
at least $30,000.
III The corporate advertising policy prohibits annual newspaper ad expenditures in excess
of $50,000.
IV Maximize the audience points for the advertising campaign.
The president has established unit weights on the goals of 10, 6, 3 and 1 for the goals 1
through 4, respectively. Formulate the above as a goal programming problem.
4. The DEWRIGHT COMPANY is considering three new products to replace current models
that are being discontinued, so their OR department has been assigned the task of de-
termining which mix of these products should be produced. Management wants primary
consideration given to three factors: long-run profit, stability in the workforce, and the
level of capital investment that would be required now for new equipment. In particular,
management has established the goals of:
I Achieving a long-run profit (net present value) of at least $125 million from these
products.
II Maintaining the current employment level of 4,000 employees.
III Holding the capital investment to less than $55 million.
However, management realizes that it probably will not be possible to attain all these goals
simultaneously, so it has discussed priorities with the OR department. This discussion has
led to setting penalty weights of 5 for missing the profit goal (per $1 million under), 2 for
going over the employment goal (per 100 employees), 4 for going under this same goal,
and 3 for exceeding the capital investment goal (per $1 million over). Each new product’s
contribution to profit, employment level, and capital investment level is proportional to
the rate of production. These contributions per unit rate of production are shown in the
following table.
Product
Factor 1 2 3
Long-run profit 12 9 15
Employment level 5 3 4
Capital investment 5 7 8
Formulate the above as a goal programming problem.
****************************************
