Business Statistics

Problem 1: Optimization

Color Chips:

 This was the first exercise on linear programming.

 The target was to develop an objective function and find a solution for the problem the solution searched for was to maximize the profit of the factory fabricating the color chips.

 The given were a set of variables A, N, P and a set of constraints which set the number of each chip to be produced. There were no limitations on the resources.

 With the given data, the objective function was found to be MAX 3.15A + 2.65N + 3.85P.

 After being introduced to the use of solver to solve a linear problem, the data was entered to the excel sheet and a data analysis tool called solver was used.

 This exercise helped define the linear programming model, a basic introduction to the use of solver in excel and a simple problem of maximization. It also shed a light on the concepts of minimization/maximization depending on the target that the user is searching for. In this problem the target was to maximize the profit.

Computers S&P:

 This exercise aimed to maximize the profit of a factory.

 A typical example of production planning.

 The variables used were S & P and the objective function was MAX 6S + 9P subject to some constraints.

 The constraints restricted the resources as well as requirements of production.

 This exercise helped understand the mixture of many constraints with a practical example on production planning. It helped understand more the linear programming model.

Make or Buy – Hamlet:

 This exercise aimed to help the factory make a decision on what to produce and what to outsource in order to find the minimum requirements of the factory.

 The target was to find the minimal amount of money required to produce a certain number of units.

 The constraints included much more factors than of the previous exercises, it included cost, time of production and restriction on the resources.

 The objective function was found to be MIN 3.15A1 + 33.75 A2 + …

 The data was entered into excel and with the use of the solver tool the solution was found.

 This exercise helped understand the minimization concept while introducing more constraints into the equation. The logical thinking moved from a straight forward problem, to a more complex real-life situation model.

Reallocating Bikes:

 This