OPERATIONS RESEARCH

Q1. Explain the types of Operations Research Models. Briefly explain the phases of
Operations Research.

Types of Operations Research Models

A model is an idealised representation or abstraction of a real-life system. The objective of a

model is to identify significant factors that affect the real life system and their
interrelationships. A model aids the decision-making process as it provides a simplified
description of complexities and uncertainties of a problem in a logical structure. The most
significant advantage of a model is that it does not interfere with the real-life system.

Physical models

These models include all forms of diagrams, graphs, and charts. They are designed to tackle
specific problems. They bring out significant factors and interrelationships in pictorial form to
facilitate analysis. There are two types of physical models. They are:

 Iconic models
 Analogue models
Mathematical or symbolic models

These models employ a set of mathematical symbols to represent the decision variable of
the system. The variables are related by mathematical systems. Some examples of
mathematical models are allocation, sequencing, and replacement models.

By nature of environment

These models can be further classified as follows:

 Deterministic models - These are the models in which everything is defined and the
results are certain, such as an EOQ model.
 Probabilistic models - These are the models in which the input and output variables
follow a defined probability distribution, such as the games theory.

By the extent of generality

These models can be further classified as follows:

 General models – These are the models which you can apply in general to any
problem. For example, linear programming.
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  Specific models - These are the models that you can apply only under specific
conditions. For example, you can use the sales response curve or equation as a
function in the marketing function.

Phases of Operations Research

The scientific method in OR study generally involves three phases.

Judgment phase

This phase includes the following activities:

 Determination of the operations

 Establishment of objectives and values related to the operations
 Determination of suitable measures of effectiveness
 Formulation of problems relative to the objectives
Research phase

This phase utilises the following methodologies:

 Operation and data collection for a better understanding of the problems

 Formulation of hypothesis and model
 Observation and experimentation to test the hypothesis on the basis of additional
data
 Analysis of the available information and verification of the hypothesis using pre-
established measure of effectiveness
 Prediction of various results and consideration of alternative methods

Action phase

This phase involves making recommendations for the decision process. The
recommendations can be made by those who identify and present the problem or by anyone
who influences the operation in which the problem has occurred.

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Q2. a. Explain the graphical method of solving Linear Programming Problem.
b. A paper mill produces two grades of paper viz., X and Y. Because of raw material
restrictions, it cannot produce more than 400 tons of grade X paper and 300 tons of
grade Y paper in a week. There are 160 production hours in a week. It requires 0.20
and 0.40 hours to produce a ton of grade X and Y papers. The mill earns a profit of Rs.
200 and Rs. 500 per ton of grade X and Y paper respectively. Formulate this as a
Linear Programming Problem.

a) Graphical Methods to Solve LPP

While obtaining the optimal solution to an LPP by the graphical method, the statement of the
following theorems of linear programming is used:

 The collection of all feasible solutions to an LPP constitutes a convex set whose
extreme points correspond to the basic feasible solutions.
 There are a finite number of basic feasible regions within the feasible solution space.
 If the convex set of the feasible solutions of the system of simultaneous equation is a
convex polyhedron, then at least one of the extreme points gives an optimal solution.
 If the optimal solution occurs at more than one extreme point, the value of the
objective function will be the same for all convex combination of these extreme
points.
Working rule

The method of solving an LPP on the basis of the above analysis is known as the graphical
method. The working rule for the method is as follows.

Step 1: Formulate the problem in terms of a series of mathematical equations representing

objective function and constraints of LPP.
Step 2: Plot each of the constraints equation graphically. Replace the inequality constraint
equation to form a linear equation. Plot the equations on the planar graph with each axis
representing respective variables.
Step 3: Identify the convex polygon region relevant to the problem. The area which satisfies
all the constraints simultaneously will be the feasible region. This is determined by the
inequality constraints.
Step 4: Determine the vertices of the polygon and find the values of the given objective
function Z at each of these vertices. Identify the greatest and the least of these values.
These are respectively the maximum and minimum value of Z.
Step 5: Identify the values of (x1, x2) which correspond to the desired extreme value of Z.
This is an optimal solution of the problem.

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b) Decision variables Let x1 and x2 be the number of units of two grades of paper of X & Y
Objective function since the profit for the two grades of paper X and Yare given, the
objective function is to maximize the profit Max(Z) = 200X1 + 500X 2 ,
Constraints There are 2 constraints i. w.r t. to raw material, and ii. w.r t .to production hours.
The complete LPP is Max (Z) =200X1 + 500X2,
Subject to X1 ≤ 400
X2 ≤ 300
0.2X1 + 0.4X2 ≤160
X1 ≥ 0 , X 2 ≥ 0,

Graphical Solution:

X1 X2 RHS Dual
Maximize 200 500
Constraint 1 1 0 <= 400 0
Constraint 2 0 1 <= 300 100
Constraint 3 0.2 0.4 <= 160 1000
Solution  200 300 19000

Q3. a. Explain how to solve the degeneracy in transportation problems.

b. Explain the procedure of MODI method of finding solution through optimality test.

a. Degeneracy in transportation problem

A basic solution to an m-origin, n destination transportation problem can have at the most
m+n-1 positive basic variables (non-zero), otherwise the basic solution degenerates. It

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follows that whenever the number of basic cells is less than m + n – 1, the transportation
problem is a degenerate one. The degeneracy can develop in two ways:

Case 1 - The degeneracy develops while determining an initial assignment via any one of
the initial assignment methods discussed earlier. To resolve degeneracy, you must augment
the positive variables by as many zero-valued variables as is necessary to complete the
required m + n – 1 basic variable. These zero-valued variables are selected in such a
manner that the resulting m + n – 1 variable constitutes a basic solution. The selected zero
valued variables are designated by allocating an extremely small positive value ε to each
one of them. The cells containing these extremely small allocations are then treated like any
other basic cells. The ε’s are kept in the transportation table until temporary degeneracy is
removed or until the optimum solution is attained, whichever occurs first. At that point, we set
each ε = 0.

Case 2 - The degeneracy develops at the iteration stage. This happens when the selection
of the entering variable results in the simultaneous drive to zero of two or more current (pre-
iteration) basic variables.

To resolve degeneracy, the positive variables are augmented by as many zero-valued

variables as it is necessary to complete m+n-1 basic variables. These zero-valued variables
are selected from among those current basic variables, which are simultaneously driven to
zero. The rest of the procedure is exactly the same as discussed in case 1.

b) Transportation Algorithm (MODI Method)

A feasible solution has to be found always. Rather than determining a first approximation by
a direct application of the simplex method, it is more efficient to work with the transportation
table. The transportation algorithm is the simplex method specialised to the format of table
involving the following steps:

i) Finding an initial basic feasible solution

ii) Testing the solution for optimality
iii) Improving the solution, when it is not optimal
iv) Repeating steps (ii) and (iii) until the optimal solution is obtained

The solution to transportation problem is obtained in two stages

In the first stage, we find the basic feasible solution using any of the following methods:

 North-west corner rule

 Matrix minima method or least cost method
 Vogel’s approximation method.
 In the second stage, we test the basic feasible solution for its optimality by MODI
method.

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Q4. a. Explain the steps involved in Hungarian method of solving Assignment
problems.
b. What do you mean by unbalanced assignment problem? How do you overcome it?

a) Hungarian Method Algorithm

Hungarian method algorithm is based on the concept of opportunity cost and is more
efficient in solving assignment problems. The following steps are adopted to solve an AP
using the Hungarian method algorithm.

Step 1: Prepare row ruled matrix by selecting the minimum values for each row and subtract
it from the other elements of the row.
Step 2: Prepare column-reduced matrix by subtracting minimum value of the column from
the other values of that column.
Step 3: Assign zero row-wise if there is only one zero in the row and cross (X) or cancel
other zeros in that column.
Step 4: Assign column wise if there is only one zero in that column and cross other zeros in
that row.
Step 5: Repeat steps 3 and 4 till all zeros are either assigned or crossed. If the number of
assignments is equal to number of rows present, you have arrived at an optimal solution, if
not, proceed to step 6.
Step 6: Mark (as correct mark) the unassigned rows. Look for crossed zero in that row. Mark
the column containing the crossed zero. Look for assigned zero in that column. Mark the row
containing assigned zero. Repeat this process till all the makings are done.
Step 7: Draw a straight line through unmarked rows and marked column. The number of
straight line drawn will be equal to the number of assignments made.
Step 8: Examine the uncovered elements. Select the minimum.

 Subtract it from the uncovered elements.

 Add it at the point of intersection of lines.
 Leave the rest as is.
 Prepare a new table.

Step 9: Repeat steps 3 to 7 till optimum assignment is obtained.

Step 10: Repeat steps 5 to 7 till number of allocations = number of rows.

b) Unbalanced AP

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Unbalanced assignment problem is an assignment where the number of rows is not equal to
the number of columns and vice versa. For example, the number of machines may be more
than the number of jobs or the number of jobs may be more than the number of machines. In
such a situation, you have to introduce dummy rows or columns in the matrix. The dummy
rows or columns will contain all cost elements as zero. This balances the problem and then
you can use Hungarian method to find the optimal assignment.

Q5. a. Write a short note on Monte Carlo Simulation.

b. A Company produces 150 cars. But the production rate varies with the distribution.

Production 147 148 149 150 151 152 153

Rate
Probability 0.05 0.10 0.15 0.20 0.30 0.15 0.05

At present the track will hold 150 cars. Using the following random numbers
determine the average number of cars waiting for shipment in the company and
average number of empty space in the truck. Random Numbers 82, 54, 50, 96, 85, 34,
30, 02, 64, 47.

a) Monte-Carlo Simulation

The Monte-Carlo method is a simulation technique in which statistical distribution functions

are created by using a series of random numbers. This approach has the ability to develop
many months or years of data in a matter of few minutes on a digital computer.

The method is generally used to solve the problems that cannot be adequately represented
by mathematical models or where solution of the model is not possible by analytical method.

Step 1: Define the problem:

a) Identify the objectives of the problem.
b) Identify the main factors that have the greatest effect on the objectives of the problem.

Step 2: Construct an appropriate model:

a) Specify the variables and parameters of the model.
b) Formulate the appropriate decision rules, i.e., state the conditions under which the
experiment is to be performed.
c) Identity the type of distribution that will be used. Models use either theoretical distributions
or empirical distributions to state the patterns of occurrence associated with the variables.
d) Specify the manner in which time will change.
e) Define the relationship between the variables and parameters.

Step 3: Prepare the model for experimentation:

a) Define the starting conditions for the simulation.
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b) Specify the number of runs of simulation to be made.

Step 4: Using steps 1 to 3, experiment with the model:

a) Define a coding system that will correlate the factors defined in step 1 with the random
numbers to be generated for the simulation.
b) Select a random number generator and create the random numbers to be used in the
simulation.
c) Associate the generated random numbers with the factors identified in step1 and coded in
step 4(a).

Step 5: Summarise and examine the results obtained in step 4.

Step 6: Evaluate the results of the simulation.
Step 7: Formulate proposals for advice to management on the course of action to be
adopted and modify the model, if necessary.

b)Solution:

Table depicts the production rate and probability.

Table: Production Rate and Probability
Production Cumulative Random No.
Probability
Rate Probability Assigned
147 0.05 0.05 00-04
1478 0.10 0.15 05-14
149 0.15 0.30 15-29
150 0.20 0.50 30-49
151 0.30 0.80 50-79
152 0.15 0.95 80-94
153 0.05 1.00 95-99

Table depicts the simulation worksheet.

Table : Simulation Worksheet

Number of
Simulated Scooter
example
Trail No Random No Production Waiting in
spaces in
Rate the factory
the truck
1 82 152 2 -
2 54 150 2 -
3 50 150 2 -
4 96 153 5 -
5 85 152 7 -
6 34 150 7 -
7 30 150 7 -
8 02 147 4 3
9 64 151 5 -

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 10 47 150 7 -
Total 3

Therefore, average number of cars waiting = 7/10 =0.7/day

Average number of empty space = 3/10 = 0.3/day

Q6. a. Explain the dominance principle in game theory.

b. Describe the Constituents of a Queuing System.
c. Differentiate between PERT and CPM.

a) In a rectangular game, the pay-off matrix of player A is pay-off in one specific row ( r row )
th exceeding the corresponding pay-off in another specific row( s row ) th . This means
thatwhatever course of action is adopted by player B, for A, the course of action Ar yields
greater gains than the course of action As .Therefore, Ar is a better strategy than As
irrespective of B’s strategy. Hence, you can say that Ar dominates As .Alternatively, if each
pay-off in a specific column ( p column ) th is less than the corresponding pay-off in another
specific column( q column ) th ,it means strategy Bp offers minor loss than strategy Bq
irrespective of A’s strategy. Hence, you can say that Bp dominatesBq .

b) Constituents of a Queuing System

In the previous section, you learnt the operating characteristics of a queuing system. You will
now learn the constituents of a queuing system. The constituents of a queuing system
include arrival pattern, service facility and queue discipline.

Arrival pattern: It is the average rate at which the customers arrive.

Service facility: Examining the number of customers served at a time and the statistical
pattern of time taken for service at the service facility.
Queue discipline: The common method of choosing a customer for service amongst those
waiting for service is ‘First Come First Serve’.

C) Difference between PERT and CPM

PERT

Some key points of PERT are as follows:

 PERT was developed in connection with an Research and Development (R&D) work.
Therefore, it had to cope with the uncertainties that are associated with R&D
activities. In PERT, the total project duration is regarded as a random variable.
Therefore, associated probabilities are calculated in order to characterize it.
 It is an event-oriented network as in the analysis of a network, emphasis is given on
the important stages of completion of a task rather than the activities required to be
performed to reach a particular event or task.

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CPM
 CPM was developed in connection with a construction project, which consisted of
routine tasks whose resource requirements and duration were known with certainty.
Therefore, it is basically deterministic.
 CPM is suitable for establishing a trade-off for optimum balancing between schedule
time and cost of the project.
 CPM is used for projects involving activities of repetitive nature.

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