EXERCISE 1

STUDY OF Excel Solver

Aim:

To conduct a study of Excel Solver

Study:

The Solver Add-in is an Excel add-in (add-in: A supplemental program that adds
custom commands or custom features to Microsoft Office.) program that is available
when Microsoft Office or Excel is installed. Solver is part of a suite of commands
sometimes called what-if analysis (what-if analysis: A process of changing the values in
cells to see how those changes affect the outcome of formulas on the worksheet). Solvers,
or optimizers, are software tools that help users find the best way to allocate scarce
resources. The resources may be raw materials, machine time or people time, money, or
anything else in limited supply. The "best" or optimal solution may mean maximizing
profits, minimizing costs, or achieving the best possible quality. Solver works with a
group of cells that are related, either directly or indirectly, to the formula in the target cell.
Solver adjusts the values in the changing cells you specify called the adjustable cells
to produce the result you specify from the target cell formula. Constraints can be
applied to restrict the values.

The Microsoft Excel Solver tool uses the Generalized Reduced Gradient (GRG2)
nonlinear optimization code developed by Leon Lasdon, University of Texas at Austin,
and Allan Waren, Cleveland State University. Linear and integer problems use the
simplex method with bounds on the variables, and the branch-and-bound method,
implemented by John Watson and Dan Fylstra, Frontline Systems, Inc.

Solution Procedure of LPP Using Excel Solver

1. Enter the coefficients of the objective function and constraints on the Excel
spreadsheet.

2. Assign the decision variable cells and objective function cell, also referred as target
cell.

3. On the Tools menu, click Solver.

4. If the Solver command is not available on the Tools menu, install the Solver add-in
program.

4a. On the Tools menu, click Add-Ins.

 4b. If the add-in is not listed in the Add-Ins available box, click Browse,
and then locate the add-in.

4c. In the Add-Ins available box, select the check box next to the add-in to
be loaded, and then click OK.

5. In the Set Target Cell box, enter a cell reference or name for the target cell. The target
cell must contain a formula.

6. Do one of the following:

o To have the value of the target cell be as large as possible, click Max.
o To have the value of the target cell be as small as possible, click Min.

o To have the target cell be a certain value, click Value of, and then type the

7. In the By Changing Cells box, enter a name or reference for each adjustable cell,
separating nonadjacent references with commas. The adjustable cells must be related
directly or indirectly to the target cell. Upto 200 adjustable cells can be specified.

8. If Solver automatically needs to propose the adjustable cells based on the target cell,
click Guess.

9. In the Subject to the Constraints box, enter any constraints you want to apply.

9a. In the Solver Parameters dialog box, under Subject to the Constraints,
click Add.

9b. In the Cell Reference box, enter the cell reference or name of the cell
range for which you need to constrain the value.

9c. Click the relationship ( <=, =, >=, Int, or Bin ) that you want between the
referenced cell and the constraint. If you click Int, "integer" appears in the
Constraint box. If you click Bin, "binary" appears in the Constraint box.

9d. In the Constraint box, type a number, a cell reference or name, or a

formula.

9e. Do one of the following:

To accept the constraint and add another, click Add.

To accept the constraint and return to the Solver Parameters
dialog box, click OK.

10. Select Assume Linear Model check box on the Solver Options dialog box.
11. Click Solve and do one of the following:

o To keep the solution values on the worksheet, click Keep Solver Solution
in the Solver Results dialog box.
o To restore the original data, click Restore Original Values.

12. Select Answers, Sensitivity Reports and Limit Reports.

Result:

The study of Excel solver was conducted.

 EXERCISE 2

PRODUCT MIX PROBLEM

AIM:

To find the solution of the given Product Mix problem using Excel Solver.

PROBLEM STATEMENT:

MODEL FORMULATION:

RESULTS:

INFERENCE: