DHA-MBM423

1. Explain briefly the types of data.

2. Discuss the situations where statistical and optimization techniques can be applied
3. A local travel agent is planning a charter trip to a major sea port. The eight day and seven night package
includes the fare for round trip, surface transportation, board and lodging and selected tour options. The
charter is restricted to 200 persons and past experience indicates that there will not be any problem for
getting 200 clients. The problem for the travel agent is to determine the number of Deluxe, Standard and
Economy tour packages to offer for this chapter. These three plans differ according to seating and service for
the flight, quality of accommodations, meal plans and tour options. The table summarizes the estimated
prices for three packages and the corresponding expenses for the travel agent. The travel agent has hired an
aircraft for the flat fee of Rs 2,00,000 for the entire trip. In planning the trip, the following consideration must
be taken into account

At least 10% of the packages must be of the Deluxe type.

At least 35% but not more than 70% must be of the standard type.

At least 30% must be of the economy type.

The maximum number of Deluxe packages available in any aircraft is restricted to 60.

The Hotel desires that at least 120 of the tourists should be on the Deluxe and Standard packages taken
together.
Tour Plan
Price
Hotel Costs
Meal and
other Expenses
Deluxe
10,000
3,000
4,750
Standard
7,000
2,200
2,500
Economy
6,500
1,900
2,200
The Travel Agent wishes to determine the number of packages to offer in each type so as to maximise the
total profit. Formulate this as a linear programming (done in class).
Restate the LPP in terms of two decision variables (Hint: take advantages of the fact that 200 packages will
be sold, i.e. x3 = 200 x1 x2)
Now solve it graphically
4. Solve any one special case graphically.
5. An advertising company wishes to plan its advertising strategy in three different media- TV, radio and
magazines. The purpose of advertising is to reach as large a number of potential customers as possible.
Following data has been obtained from market survey:
TV
Radio
Magazine I
Magazine II
Cost of advertising a Rs. 30,000
Rs. 20,000 Rs. 15,000
Rs. 10,000
unit
No. of potential
2,00,000
5,00,000
1,50,000
1,00,000
customers reached
per unit
No. of female
1,50,000
3,00,000
70,000
50,000
customers reached
per unit

The company wants to spend no more than Rs. 4,50,000 on advertising. Following are the further requirements
that must be met:
a. At least 1 million exposures take place among female customers
b. Advertising on magazines be limited to 1,50,000
c. At least 3 advertising units be bought on magazine I and 2 units on magazine II
d. The number of advertising units on TV and radio should each be between 5 and 10.
6. A production planner in a soft drink plant has two bottling machines A (for 8-ounce bottles) and B (for 16ounce bottles). However,, each can be used on both types with some loss of efficiency. The following data is
available:
8-ounce bottles
16-ounce bottles
Machine A
100/minute
40/minute
Machine B
60/minute
75/minute
The machine can be run 8-hour per day, 5 days a week. Profit on 8-ounce bottle is 25 paise and on 16-ounce
bottles is 15 paise. Weekly production of the drink cannot exceed 2,00,000 ounces and the market can absorb
25,000 8-ounce bottles and 7000 16-ounce bottles per week. The planner wishes to maximize his profit
subject to all the production and marketing constraints. Formulate this as an LPP.