HOMEWORK-1 3.1.

8 Frame Parts (unit) Electrical Components (unit) Profit ($) Max number to be produced 1 2 1 no constraint 3 2 2 60 unit 200 unit 300 unit

Product 1 Product 2 Availability

x1: the number of units of product 1 that will be produced x2: the number of units of product 2 that will be produced Objective Function: Max Z = x1 + 2x2 St: Frame Parts Constraint: x1 + 3x2 200 Electrical Components Constraint: 2x1 + 2x2 300 Production Limit: x2 60 Nonnegativity: x1,x2 0 Graphical Method: 1- x1 + 3x2 = 200 x1=0, x2=200/3 and x1=200, x2=0 2- 2x1 + 2x2 = 300 x1=0, x2=150 and x1=150, x2=0 3- x2 = 60

HOMEWORK-1 From the graph we can see that the optimal point is the intersetion of constraint 1 and constraint 2 So if we solve them together we get: x1 + 3x2 = 200 2x1 + 2x2 = 300 -------------------Optimum number of product 1 that will be produced = x1*=125 Optimum number of product 2 that will be produced x2*= 25 Z= x1 + 2x2The maximum profit: Z*=175

(Excel solver is attached and as below:) Solution 3.1.8 Profit 1 2 availabilty: Frame Parts 1 3 200 Electrical Components 2 2 300 Max. Number to be produced no constraint 60 # that should be produced 125 25

Product 1 Product 2

Constraints: Frame Parts

200

<= <= <=

200 300 60 175

Electrical Components 300 Production limit 25

Profit Generated:

HOMEWORK-1 3.1.9 Work Hours per Unit Special Risk Mortgage 3 2 0 1 2 0 5 2 Work Hours Available 2400 800 1200

Department Underwriting Administration Claims Expected Profit ($)

x1: the number of units on Special Risk Insurance x2: the number of units of Mortgage Objective Function: Max Z = 5x1 + 2x2 St: Underwriting work hours constraint: 3x1 + 2x2 2400 Administration work hours constraint: 3x2 800 Claims work hours constraint: 2x1 1200 Nonnegativity: x1,x2 0 Graphical Method: 1- 3x1 + 2x2 = 2400 x1=0, x2=1200 and x1=800, x2=0 2- 3x2 = 800 x2=800 3- 2x1 = 1200 x1=600

HOMEWORK-1 From the graph we can see that the optimal point is the intersetion of constraint 1 and constraint So if we solve them together we get: 3x1 + 2x2 = 2400 2x1 = 1200 ----------------------Optimum sales quotas on Special Risk Insurance = x1*=600 Optimum sales quotas on Mortgage x2*=300 Z= 5x1 + 2x2The maximum profit: Z*=3600

(Excel solver is attached and as below:) Solution 3.1.9 Profit 5 2 availabilty: Underwriting 3 2 2400 Administrator 0 1 800 Claims 2 0 1200 Sales Quotas 600 300

Special Risk Mortgage

Constraints: Underwriting Administrator Claims

2400 300 1200 Profit Generated:

<= <= <=

2400 800 1200 3600