Group#1

1. Union Airways is adding more flights to and from its hub airport, and
so it needs to hire additional customer service agents. However, its
is not clear just how many more should be hired. Management
recognizes the need for cost control while also consistently
providing a satisfactory level of service to customers. Therefore, an
OR team is studying how to schedule the agents to provide
satisfactory service with the smallest personnel cost.
Based on the new schedule of flights, an analysis has been made of
the minimum number of customer service agents that need to be
duty at different times of the day to provide a satisfactory level of
service. The rightmost column of the following table shows the
number of agents needed for the time periods given in the first
column.
Time periods covered

Time period
6.00 am to 8.00 am
8.00am to 10.00 am
10.00 am to noon
Noon to 2.00 pm
2.00 pm to 4.00 pm
4.00 pm to 6.00 pm
6.00 pm to 8.00 pm
8.00 pm to 10.00 pm
10.00 pm to midnight
Midnight to 6.00 am
Daily cost per agent

Shift
1

Minimum
number
of
Agents needed
2

5
48
79
65
87
64
73
82
43
52
15

170

160

175

180

195

The other entries in this table reflect one of the provisions in the
companys current contract with the union that represents the
customer service agents. The provision is that each agent work
an 8- hour shift 5 days per week, and the authorized shifts are:
Shift #1: 6.00 A.M to 2.00 P.M
Shift #2: 8.00 A.M to 4.00 P.M
Shift #3: Noon to 8.00 P.M
Shift #4: 4.00 P.M to Midnight
Shift #5: 10.00 P.M to 6.00 A.M
Because some shifts are less desirable than others, the wages
specified in the contract differ by shift. For each shift, the daily
compensation (including benefits) for each agent is shown in the
bottom row of the above table. Determine how many agents
should be assigned to the respective shifts each day to minimize
the total personnel cost for agents, based on this bottom row,
while meeting the service requirements given in the rightmost
column.

2. A mutual Fund company has Rs.20 lakhs available for investment in

Government bonds, blue chip stocks, speculative stocks and short
term bank deposits. The annual expected return and risk factors are
given as follows.
Type
of
investment
Government
bonds
Blue chip stocks
Speculative
stocks
Short
term
deposits

Annual expected Risk factor

return
( 0 to 100)
14%
19%

12
24

23%

48

12%

Mutual Fund is required to keep at least Rs.2 lakhs in short term

deposits and not to exceed an average risk factor of 42.
Speculative stocks must be at most 20 % of the total amount
invested. How should Mutual Fund invest the funds so as to
maximize its total expected annual return?

Group#2
1. A company manufactures two bottling machines X, Y. X is
designed for 5- ounces bottles, and Y for 10- ounces bottles.
However, each can be used on both types with some loss of
efficiency. The following data are available:
Machi
ne
X
Y

5-ounce
bottles
80/min
40/min

10-ounce
bottles
30/min
50/min

The machines can be run 8 hours per day, for 5 days a week.
Profit on 5-ounce bottle is 20 paise, and on 10 ounce bottle is 30
paise. Weekly production of the drink can not exceed 500000
ounces; and, the market can absorb 30,000 (5-ounce) bottles
and 8000 (10-ounce) bottles per week. The company wishes to
maximize its profit, subject to all the production and marketing
constraints.
2.

A dairy has two milk plants with, daily milk production of 6

million liters and, 9 million liters respectively. Each day, the firm
must fulfill the needs of its three distribution centers which have the
milk requirements of 7, 5, and 3 million liters, respectively. Cost of
shipping 1 million liters of milk from each plant to each distribution
center is given in hundreds of rupees below. Formulate the linear
programming model to minimize the transportation cost.
Distribution center
Plant
1
2
Dema
nd

1
2
1

2
3
9

3
11
6

Suppl
y
6
9

Group #3
1. Suppose that a company has a total of 5 million dollars that can
be exchanged for Euros (), British pounds (), Yen (), and
Kuwaiti Dinars (KD). Currency dealers set the following limits on
the amount of any single transaction: 5 million dollars, 3 million
Euros, 3.5 million pounds, 100 million yen, and 2.8 million KDs.
The table below provides typical spot exchange rates. The
bottom diagonal rates are the reciprocal of the top diagonal
rates.
For example rate ($) = 1/rate ($)=1/0.769=1.30.
$

KD

1
0.769
0.625
105
1/0.769
1
0.813
137
1/0.625 1/0.813
1
169
1/105
1/137
1/169
1
1/0.342 1/0.445 1/0.543 1/0.0032

KD
0.342
0.445
0.543
0.0032
1

Is it possible to increase the dollar holdings by circulating

currencies through the currency market?

Group #4
1.

A trucking company with Rs.40,00,000 to spend on new equipment is contemplating

three types of vehicles. Vehicle A has a 10-tonne pay- load and is expected to average 35
km per hour. It costs Rs..80,000. Vehicle B has a 20-tonne pay-load and is expected to
average 30 km per hour. It costs Rs. 1,30,000. Vehicle C is a modified form of B; it
carries sleeping quarter for one driver, and this reduces its capacity to 18 tones and raises
the cost to Rs.1,50,000. Vehicle A requires a crew of one man, and if driven on three
shifts per day, could be run for an average of 18 hours per day. Vehicle B and C require a
crew of two men each, but where as B would be driven 18 hours per day with three
shifts, C could average 21 hours per day. The company has 150 drivers available each day
and would find it very difficult to obtain further crews. Maintenance facilities are such
that the total number of vehicles must not exceed 30. How many vehicles of each type
should be purchased if the company wishes to maximize its capacity in tone kms per day?

2. The Southern Confederation of Kibbutzim is a group of three kibbutzim (communal

farming communities) in Israel. Overall planning for this group is done in its
Coordinating Technical Office. This office currently is planning agriculture production
for the coming year.
The agriculture output of each kibbutz is limited by both the amount of available irrigable
land and the quantity of water allocated for irrigation by the water Commissioner (a
national government official).
The crops suited for this region include sugar beets, cotton, and sorghum, and these are
the three being considered for the upcoming season. These crops differ primarily in their
expected net return per acre and their consumption of water. In addition, the Ministry of
Agriculture has set a maximum quota for the total acreage that can be devoted to each of
these crops by the Southern Confederation of Kibbutzim, as shown below.
Crop data for the Southern Confederation Of Kibbutzim
Water consumption
Crop
Maximum quota (Acres)
(Acre feet/Acre)
Net return(Rs/Acre)
Sugar beets
600
3
1000
Cotton
500
2
750
Sorghum
325
1
250
Resource data for the Southern Confederation Of Kibbutzim
Kibbutz
Usable land (Acres)
Water allocation (Acre feet)
1
400
600
2
600
800
3
300
375
Because of the limited water available for irrigation, the Southern Confederation of
Kibbutzim will not be able to use all its irrigable land for planting crops in the
upcoming season. To ensure equity between the three kibbutzim, it has been agreed
that every kibbutz will plant the same proportion of its available irrigable land. For
example, if kibbutz 1 plants 200 of its available 400 acres, then kibbutz 2 must plant
300 of its 600 acres, while kibbutz 3 plants 150 acres of its 300 acres. However, any
combination of the crops may be grown at any of the kibbutzim.
The job facing the Coordinating Technical Office is to plan how many acres to devote
to each crop at the respective kibbutz while satisfying the given restriction. The
objective is to maximize the total net return to the Southern Confederation of
Kibbutzim.

Group #5
A manufacturer currently produces four products. Recent recessionary trends cause a
decline in demand and the company is laying off workers and discontinuing its third shift.
The problem is that of rescheduling production during the first and second shifts for the
remaining quarter of the year. The production involves various processes and one limiting
resource in production is the availability of machine hours for a particular process Z. For
this process, the four products require 4, 5, 5, and 7 hours respectively.
The sales manager has forecast the expected sales for each of the four products in the last
quarter of the year. The estimates are shown in the following table:
Month
October
November
December

Product#1
8000
7000
6000

Forecast sales
Product#2
Product#3
19000
4000
19000
15000
18000
17000

Product#4
7000
7000
7000

The production capacity in terms of process Z, hours available is expressed by month and shift.
Process Z , hours
available
Month
Shift 1
Shift 2
October
110000
100000
November
130000
120000
December
115000
116000

The labor cost of operating the process Z machines is Rs100 per hour during the first shift
and Rs.120 for the second shift. The other relevant cost is storage. It costs Rs.40 per
month to store one unit of any of the four products. It may be noted that it will be
necessary to store some units of the four products as there is not enough labor available
during the December demand.
Assuming that the company wishes to produce as many products as the sales manager has
forecast, formulate an LP model to determine a production schedule that will meet the
demand at minimum cost.

Group #6
1. The Scottsville Textile Mill produces five different fabrics. Each fabric can be woven
on one or more of the mills 38 loom. The sales departments forecast of demand for
the next month is given in the table 1, along with data on the selling price per yard,
variable cost per yard, and purchase price per yard. The mill operates 24 hours a day
and is scheduled for 30 days during the coming month.
The mill has two types of looms: dobbie and regular. The dobbie looms are more
versatile and can be used for all five fabrics. The regular looms can produce only three
of the fabrics. The mill has a total of 38 looms: 8 are dobbie and 30 are regular. The
rate of production for each fabric on each type of loom is given in the table 2. The time
required to change over from producing one fabric to another is negligible and does
not have to be considered.
The Scottsville Textile Mill satisfies all demand with either its own fabric or fabric
purchased from another mill. Fabrics that cannot be woven at the Scottsville Textile
Mill because of limited loom capacity will be purchased from another mill. The
purchase price of each fabric is also shown in the table 1.
Table 1: Monthly demand, Selling price, Variable cost, and Purchase price data for
Scottsville Textile Mill fabrics.
Fabric

Demand (yards)

1
2
3
4
5

16500
22000
62000
7500
62000

Selling
($/yard)
0.99
0.86
1.10
1.24
0.70

price Variable
($/yard)
0.66
0.55
0.49
0.51
0.50

cost Purchase
($/yard)
0.80
0.70
0.60
0.70
0.70

Table 2: Loom production rates for the Scottsville Textile Mill

Loom Rate (yards / hour)
Fabric
Dobbie
Regular
1
4.63
2
4.63
3
5.23
5.23
4
5.23
5.23
5
4.17
4.17
Develop a model that can be used to schedule production for the Scottsville Textile
Mill.

price