Goal Programming Simplex Algorithm (Exercises)

Goal Programming Simplex Algorithm Exercises
PromotionsInc Advertising Agency
The PromotionsInc Advertising Agency is trying to determine a TV advertising schedule for FastCars
Auto Company. FastCars has three goals:
 Goal 1: Its ads should be seen by at least 40 million high-income men (HIM). Each million exposures
by which FastCars falls short of the HIM goal costs FastCars a R200 000 penalty because of lost
sales.
 Goal 2: Its ads should be seen by at least 60 million low-income people (LIP). Each million
exposures by which FastCars falls short of the LIP goal costs FastCars a R100 000 penalty because
of lost sales.
 Goal 3: Its ads should be seen by at least 35 million high-income women (HIW). Each million
exposures by which FastCars falls short of the HIW goal costs FastCars a R50 000 penalty because
of lost sales.
PromotionsInc can purchase two types of ads: those shown during rugby games and those shown
during soap operas. At most, R600 000 can be spent on ads. The advertising costs and potential
audiences of a one-minute ad of each type are shown in the table.
Cost and Number of Viewers of Ads
Millions of Viewers
Ad HIM LIP HIW Cost (R)
Rugby 7 10 5 100 000
Soap opera 3 5 4 60 000
PromotionsInc must determine how many rugby ads and soap opera ads to purchase for FastCars.
1. Formulate a Goal Programming Model to help PromotionInc Advertising Agency the penalty
associated with meeting the annual chip requirements.
2. Solve the formulated Goal Programming Model of PromotionInc Advertising Agency using the
Goal Programming Simplex Algorithm.
Apricot Computer Company
Apricot Computer Company is ready to make its annual purchase of computer chips. Apricot can
purchase chips (in lots of 100) from three suppliers. Each chip is rated as being of excellent, good, or
mediocre quality. During the coming year, Apricot will need 5 000 excellent chips, 3 000 good chips,
and 1 000 mediocre chips. The characteristics of the chips purchased from each supplier are shown
in the table. Each year, Apricot has budgeted $28 000 to spend on chips.
If Apricot does not obtain enough chips of a given quality, then the company may special-order
additional chips at $10 per excellent chip. $6 per good chip, and $4 per mediocre chip.
Apricot assesses a penalty of $1 for each dollar by which the amount paid to suppliers 1 – 3 exceeds
the annual budget.
3. Formulate a Goal Programming Model to help Apricot minimise the penalty associated with
meeting the annual chip requirements.
4. Solve the formulated Goal Programming Model of Apricot using the Goal Programming
Simplex Algorithm.
Highland Appliance
Highland Appliance must determine how many colour TVs and VCRs should be stocked. It costs
Highland R300 to purchase a colour TV and R200 to purchase a VCR. A colour TV requires 3𝑚2 of
storage space, and a VCR requires 1𝑚2 of storage space. The sale of a colour TV earns Highland a
profit of R150, and the sale of a VCR earns Highland a profit of R100. Highland has set the following
goals (listed in order of importance):
 Goal 1: A maximum of R20,000 can be spent on purchasing colour TVs and VCRs.
 Goal 2: Highland should earn at least R11,000 in profits from the sale of colour TVs and VCRs.
 Goal 3: Colour TVs and VCRs should use no more than 200𝑚2 of storage space.
1. Formulate a Goal Programming Model to help Highland find out how many colour TVs and
VCRs to order.
2. Solve the formulated Goal Programming Model of Highland using the Goal Programming
Simplex Algorithm.
3. How would the goal programming formulation be modified if Highland’s goal were to have a
profit of exactly R11,000?
Random Product
A company produces two products. Relevant information for each product is shown in the below table.
The company has a goal of R48 in profits and incurs a R1 penalty for each dollar it falls short of this
goal. A total of 32 hours of labour are available. A R2 penalty is incurred for each hour of overtime
(labour over 32 hours) used, and a R1 penalty is incurred for each hour of available labour that is
unused. Marketing considerations require that at least 10 units of product 2 be produced. For each
unit (of either product) by which production falls short of demand, a penalty of R5 is assessed.
1. Formulate a Linear Programming Model to help the company minimise the penalty incurred
by the company.
Suppose the company sets (in order of importance the following goals:
 Goal 1: Avoid underutilization of labour.

 Goal 2: Meet demand for product 1.
 Goal 3: Meet demand for product 2.
 Goal 4: Do not use any overtime.
2. Formulate a Goal Programming Model to help solve the company’s requirements.
3. Solve the formulated Goal Programming Model of this company using the Goal Programming
Simplex Algorithm.
Deancorp
Deancorp produces sausage by blending together beef head, pork chuck, mutton, and water. The cost
per kilogram, fat per kilogram, and protein per kilogram for these ingredients is given in the table.
Deancorp needs to produce 100 kilograms of sausage and has set the following goals, listed in order
of priority:
 Goal 1: Sausage should consist of at least 15% protein.

 Goal 2: Sausage should consist of at most 8% fat.
 Goal 3: Cost per kilogram of sausage should not exceed 8c.
1. Formulate a Goal Programming Model for Deancorp.
2. Solve the formulated Goal Programming Model of Deancorp using the Goal Programming
Simplex Algorithm.
Touche Young
The Touche Young accounting firm must complete three jobs during the next month. Job 1 will require
500 hours of work, job 2 will require 300 hours of work, and job 3 will require 100 hours of work.
Currently, the firm consists of 5 partners, 5 senior employees, and 5 junior employees, each of whom
can work up to 40 hours per month. The rand amount (per hour) that the company can bill depends
on the type of accountant who is assigned to each job, as shown in the table. (The X indicates that a
junior employee does not have enough experience to work on job 1).
All jobs must be completed. Touche Young has also set the following goals listed in order of priority:
 Goal 1: Monthly billing should exceed R68,000.

 Goal 2: At most, 1 partner should be hired.
 Goal 3: At most, 3 senior employees should be hired.
 Goal 4: At most, 5 junior employees should be hired.
1. Formulate a Goal Programming Model for Touche Young.
2. Solve the formulated Goal Programming Model of Touche Young using the Goal Programming
Simplex Algorithm.
Faber College Business School
There are four teachers in the Faber College Business School. Each semester, 200 students take each
of the following courses: marketing, finance, production, and statistics. The “effectiveness” of each
teach in teaching each class is given in the table. Each teacher can teach a total of 200 students during
the semester. The dean has set a goal of obtaining an average teaching effectiveness level of about 6
in each course. Deviations from this goal in any course are considered equally important.
1. Formulate a Goal Programming Model for Faber College Business School that can be used to
determine the semester’s teaching assignments.
2. Solve the formulated Goal Programming Model of Faber College Business School using the
Goal Programming Simplex Algorithm.

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Goal Programming Simplex Algorithm Exercises

PromotionsInc Advertising Agency

Apricot Computer Company

 Goal 1: Avoid underutilization of labour.

 Goal 1: Sausage should consist of at least 15% protein.

 Goal 1: Monthly billing should exceed R68,000.

Faber College Business School

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