For resource-allocation problems.

Limits are set on the use of various resources (including financial re

then the objective is to make the most effective use (according to some overal measure of performan

For cost-benefit-trade-off problems, management takes a more aggresive stance,

prescribing what benefits must be achieved by the activities under consideration (regardless of
the resulting resource usage), and then the objective is to achieve all these benefits with minimum co
By prescribing a minimum acceptable level for each kind of benefit, and then minimizing the cost nee
to achieve these levels, management hopes to obtain an approproate trade-off between cost and ben
(Levels achieved Minimum acceptable levels"

"

)/(one of the benefits)

ncluding financial resources), and

easure of performance) of these given resources.

(regardless of
fits with minimum cost.
nimizing the cost needed
etween cost and benefits.

e benefits)

Microsoft Excel 14.0 Answer Report

Worksheet: [(1)Cost-Trade-Off.xls]Cost Allocation
Report Created: 11/16/2015 12:12:31 PM
Result: Solver found a solution. All Constraints and optimality conditions are satisfied.
Solver Engine
Engine: Simplex LP
Solution Time: 0.016 Seconds.
Iterations: 11 Subproblems: 0
Solver Options
Max Time Unlimited, Iterations Unlimited, Precision 0.000001
Max Subproblems Unlimited, Max Integer Sols Unlimited, Integer Tolerance 1%, Assume NonNegati

Objective Cell (Min)

Cell
$AB$17

Variable Cells
Cell
$U$17
$V$17
$W$17
$X$17
$Y$17

Name
Total Agents Total Cost

Total
Total
Total
Total
Total

Name
Agents Time Periods Covered by Shift
Agents
Agents
Agents
Agents

Constraints
Cell
$Z$6
$Z$7
$Z$8
$Z$9
$Z$10
$Z$11
$Z$12
$Z$13
$Z$14
$Z$15
$U$17:$Y$17=Integer

Name
6.00 AM to 8.00 AM Result
8.00 AM to 10.00 AM Result
10.00 AM to Noon Result
Noon to 2.00 PM Result
2.00 PM to 4.00 PM Result
4.00 PM to 6.00 PM Result
6.00 PM to 8.00 PM Result
8.00 PM to 10.00 PM Result
10.00 PM to Mid Result
Mid to 6.00 AM Result

ty conditions are satisfied.

Tolerance 1%, Assume NonNegative

Original Value
0

Final Value
30610

Original Value
0
0
0
0
0

Final Value

Cell Value

Formula
$Z$6>=$AB$6
$Z$7>=$AB$7
$Z$8>=$AB$8
$Z$9>=$AB$9
$Z$10>=$AB$10
$Z$11>=$AB$11
$Z$12>=$AB$12
$Z$13>=$AB$13
$Z$14>=$AB$14
$Z$15>=$AB$15

48
79
79
118
70
82
82
43
58
15

48
31
39
43
15

Integer
Integer
Integer
Integer
Integer
Integer

Status
Binding
Binding
Not Binding
Not Binding
Not Binding
Not Binding
Binding
Binding
Not Binding
Binding

Slack
0
0
14
31
6
9
0
0
6
0

The Problem
Union Airways is adding more flights to and from its hub airport and so needs to hire additional customer service agents.
However, it 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 the company's customers, so a desirable trade-off
between these two factors is being sought. Therefore, a management science 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 on duty at different times of the day to provide a satisfory level of service. These numbers are shown
in the last column of table for the time periods given in the first column. The other entries in this table reflect one of
the provisions in the company's current contract with the union that represents the customer service agents
The provision is that each agent works an eight-hour shift. The authorized shifts are
Shift 1
:
6:00 AM to
2:00 PM
Shift 2
:
8:00 AM to
4:00 PM
Shift 3
:
Noon
to
8:00 PM
Shift 4
:
4:00 PM
to Midnight
Time Periods Covered by Shift
Shift 5
:
10:00 PM to 6:00 AM
Time Period
1
2
3
4

6.00 AM to 8.00 AM
8.00 AM 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 Mid
Mid to 6.00 AM
Daily Cost per Agent

1
1
1
1
0
0
0
0
0
0
170

0
1
1
1
1
0
0
0
0
0
160

0
0
0
1
1
1
1
0
0
0
175

0
0
0
0
0
1
1
1
1
0
180

0
0
0
0
0
0
0
0
1
1
195

Cost

1
170

Time Periods Covered by Shift

2
3
4
160
175
180

5
195

Barier

6.00 AM to 8.00 AM
8.00 AM 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 Mid
Mid to 6.00 AM
Minimum of
Number Agents

Needed
48
79
65
87
64
73
82
43
52
15

Total Agents

1
1
1
1
0
0
0
0
0
0

0
1
1
1
1
0
0
0
0
0

0
0
0
1
1
1
1
0
0
0

0
0
0
0
0
1
1
1
1
0

0
0
0
0
0
0
0
0
1
1

48

31

39

43

15

Result
48
79
79
118
70
82
82
43
58
15

Sign
>=
>=
>=
>=
>=
>=
>=
>=
>=
>=

Number Agents
Needed

48
79
65
87
64
73
82
43
52
15
Total Cost
30610

Microsoft Excel 14.0 Answer Report

Worksheet: [(1)Cost-Trade-Off.xls]yang di word
Report Created: 11/16/2015 12:51:20 PM
Result: Solver found a solution. All Constraints and optimality conditions are satisfied.
Solver Engine
Engine: Simplex LP
Solution Time: 0.016 Seconds.
Iterations: 4 Subproblems: 0
Solver Options
Max Time Unlimited, Iterations Unlimited, Precision 0.000001
Max Subproblems Unlimited, Max Integer Sols Unlimited, Integer Tolerance 1%, Assume NonNegati

Objective Cell (Min)

Cell
Name
$P$14 <= Total Cost

Original Value
0

Final Value
12762.5

Variable Cells
Cell
Name
$K$13 Total Reached Target
$L$13 Total Each Magazine Ad
$M$13 Total Each Sunday Ad

Original Value
0
0
0

Final Value

Cell Value

Formula
$K$13<=$K$16+$K$15
$N$11=$P$11
$N$5<=$P$5
$N$6<=$P$6
$N$8>=$P$8
$N$9>=$P$9

Constraints
Cell
Name
$K$13 Total Reached Target
$N$11 Coupon Redemption Result
$N$5 Ad Budget Result
$N$6 Planning Budget Result
$N$8 Young children Result
$N$9 Parent of young children Result

5
1490
2756.25
948.75
6.0125
5

5
0.125
12.375

ns are satisfied.

%, Assume NonNegative

Integer
Contin
Contin
Contin

Status
Binding
Binding
Not Binding
Not Binding
Not Binding
Binding

Slack
0
0
1243.75
51.25
1.0125
0

Cost Category
Ad Budget
Planning Budget
Expected number of exposures

Each TV Commercial
300000
90000
1300000

Costs ($)
Each Magazine Ad
150000
30000
600000

Number Reached in Target Category (in m

Target Category
Young children
Parent of young children

Requirement
Coupon Redemption

Each TV commercial

Each Magazine Ad

1,2
0,5

0,1
0,2

Each TV Spot
0

Contribution toward Required Amou

Each Magazine Ad
40000

$)
Each Sunday Ad
100000
40000
500000

ed in Target Category (in millions)

Each Sunday Ad
0
0,2

ion toward Required Amount

Each Sunday Ad
120000

Minimum Acceptable
Level
5
5

Required Amount
1490000

Each TV Commercial
1300

Each Magazine Ad
600
150
30

Young children

300
90
Reached Target
1.2

Parent of young children

0.5

0.2

Coupon Redemption

40

Total

5
<=
5

0.125

Budget
Ad Budget
Planning Budget

0.1

Each Sunday Ad
500
100
40

Result
2756.25
948.75

Sign
<=
<=

Constrains
4000
1000

6.0125

>=

0.2

>=

120

1490

1490

12.375

Total Cost
12762.5