INTRODUCTION Since time immemorial, man has struggled for survival and in this; he produces his wants/needs.

The resources for the production of these wants are not so abundant, so he tries to maximize the limited resources available and minimizes cost of producing his needs. To do this, he must be conversant with the technology available as for its products, services and method of operation concerned. Production can be defined as the creation and distribution of goods and services. While production planning is made in order to utilize the limited amount of resources available for use. As a result of this, there is need therefore to produce those goods which is most pressing i.e making a scale of preference. Opportunity cost is not left out since we have limited resources thus we forego the production of the less pressing wants. To help assist the managers ability to take a wise decision constitutes what is known as Operations Research.

The knowledge of Operations Research helps companies to maximize their profit by managing their resources effectively. Nature of Operations Research The first formal activities of Operations Research were initiated in England during World War II when a team of British scientists set out to make decisions regarding the most effective allocation of limited military resources to the various military operations and to the activities within each operation. Gupta (1979). A cornerstone of Operations Research is mathematical modeling. Though the solution of the mathematical model provides a basis for making a decision, unquantifiable factors such as human behavior must be accounted for before a final decision can be reached. Mathematical models are used in their functional forms as linear equations or inequalities such that several of them are combined to form a system. Constraint equation retaining the variable in a set of objective function, which is to be optimized, depends on

the goals of the firm and assuming some other necessary properties of the variables (e.g non-negative assumption). The most important contribution Operations Research makes is in decision of lower, middle and top management level, based on the application of its output. The

mathematical model and the linear programming which is the main focus of this study is an important Operation Research technique that produce output, which form the best combination of planning, organizing, directing and controlling of the firms activities which are essential for the

management. Brief History of Phinomar Farms Phinomar farms are a private-owned farm established in the 1990s. It is located in Ngwo, Enugu to help provide the basic proteinous needs of the residents of the area and the state in entirety. Their range of products include Broiler breeder, Layer breeder, Commercial layer, Turkey, Day Old Chicks, Frozen chicken and parts. The majority of the staff

was recruited from the local community as a way of creating employment opportunities for them. They often meet with representatives of the various community groups to foster ways of moving the estate forward as regarding developments. At Phinomar they continually engage in the upgrading and redesigning of the operations and facilities to meet the latest standards. They embrace the use of technology not only to improve the efficiency of the operations but in safeguarding the health of the customers making sure only the best gets to their doorstep. They have been engaging the intensive information technology to further improve the efficiency of the operations. Scope of the study This project has the intention of limiting its scope to cover the production set up (i.e factory activities of transforming the raw materials into finished goods and not the

administration welfare of the company. After all these, it will cover the best product mixture that will maximize the firms profit given the necessary constraints and most effective decision variables to be employed and discharged. Statement of the problem Most problems faced by the companies are the problem concerning their inability to apply the right tool (total input in production and its yield). This had led to profit loss in most organizations or not being able to maximize their profit. This gives rise to Linear Programming which has proved to be the right tool for solving these problems, if the following conditions are satisfied; 1. There must be a well defined objective function (profit, cost of quantities produced) which is to be either maximized or minimized and which can be expressed as a linear function of decision variables.

2. There must be constraints on the amount or extent of attainment of the objective and these constraints must be capable of being expressed as linear equations or inequalities in terms of variables. 3. The decision variables should be inter-correlated and non-negative. The non-negative condition shows that Linear Programming deals with real-life situations for which negative quantities are generally illogical. Objective of the Study The main objective is to develop a Linear Programming model that will enable Phinomar Farms to maximize her total profit so that the company will allocate more resources to the production of such product amongst the brands of broiler feed; pre-starter, starter and finisher. Secondly, to carry out a sensitivity analysis to ascertain the stability of the firms optimal solution or profit. Relevance of this study

This work will enlighten most industries who are traditional in their methods of decision making that the contemporary World has at its disposal modern techniques of decision making in optimizing profit and cost (minimization and maximization). It will also motivate them to use such technique which eventually boosts the countrys economy, Nigeria inclusive. LITERATURE REVIEW It is imperative for broiler producers to source for cheap alternative feedstuffs without affecting the quality of the feed, productive performance of the birds and the economics of production. One of the major problems facing broiler producers is high prices and non-availability of feed ingredients. The feed cost incurred about 60-65% of the total cost of broiler production. Availability of quality feed at a reasonable cost is a key to successful poultry operation (Hodge and Rowland, 1978).Linear Programming is one of the most important techniques to allocate available

feedstuffs in a least-cost broiler ration formulation (Dantzig, 1951 a,b; Alector, 1986; Ali and Lesson, 1995) Linear Programming (LP) is a technique for optimization of a linear objective function, subject to linear equality and linear inequality constraints (Keuster and Mize, 1973). Informally, Linear Programming determines the way to achieve the best outcome (such as maximum profit or lower cost) in a given mathematical model and given some list of requirements represented as linear equations. Patrick and Schaible (1980) stated that Linear Programming is

technically a mathematical procedure for obtaining a valueweighting solution to a set of simultaneous equations. Linear Programming was first to put into significant use during the World War II when it was used to determine the most

effective way of deploying troops, ammunitions, machineries which were all scarce resources (Chvatal, 1983). There are hundreds of applications of Linear Programming in

agriculture (Taha, 1987). Olurunfemi et al (2001) also applied Linear Programming into duckweed utilization in least-cost feed formulation for broiler starter. Gonzalez-Alcorta et al (1994) developed a profit maximization model that uses non-linear and separable programming to determine the precise energy and protein levels in the feed that maximizes profit. Their model is distinguished by the assumption that body weight is not fixed at a pre-determined level. Feed cost is not determined by least cost feed formulation. Rather feed cost is determined as a variable of the profit maximization model in a similar to that described in Pesti et al. (1986). Costa et al. (2001) developed a 2-step profit maximization model that minimizes feed cost and maximizes profit in broiler production. Their model indicates the optimal average feed consumed, feed cost, live and processed body weight of chickens, as well as the optimal length of time that the broilers must stay in the

house and other factors, for given temperature, size of the house, costs of inputs and outputs and for certain predetermined protein level, source and processing decisions. Njideka (2006) in her project Establishing a production quota for Hardis and Dromedas Nig Ltd used Linear Programming to maximize profit. Osigwe (2010) in his project titled Profit Maximization of Bread production using Linear Programming technique used the Simplex method to determine the optimal quantities of bread to be produced at UAC Foods, Nigeria, PLC, Ikeja. Also, John (2010) in her project Optimization in Soap Production advised PZ Cussons, Aba Soap factory on the need for the company to use the technique of Linear Programming and also employ the aid of Operations Researchers to keep the company afloat. Meaning and Concept of Linear Programming

Linear programming is that branch of mathematical programming which is designed to solve optimization problems where all the constraints as well as the objectives are expressed as linear function. It was developed by George B. Dantzig in 1947. Linear programming is a technique for making

decisions under certainty i.e; when all the courses of options available to an organization are known and the objective of the firm along with its constraints are quantified. That course of action is chosen out of all possible alternatives which yield the optimal results. Linear programming can also be used as a verification and checking mechanism to ascertain the accuracy and the reliability of the decisions which are taken solely on the basis of managers experience without the aid of a mathematical model.

Thus, it can be defined as a method of planning and operation involved in the construction of a model of a reallife situation having the following elements; a) Variables which denote the available b) The related mathematical expressions which relate the variables to the controlling conditions, which reflect clearly the criteria to be employed for measuring the benefits flowing out of each course of action and providing an accurate measurement of the

organizations objective. Definitions of Some Basic Terminologies Simplex Method; This is a mathematical procedure that uses addition, subtraction, multiplication and division in a particular sequence to solve a linear programming problem. It requires the use of iterative method to reaching the optimal solution.

 Objective Function; This is the quantity to be maximized or minimizes. It is, in general, the function which represents the goal of the economic agent (firm). Constraint; This allows the unknowns activities to take on certain values (raw materials). It does not make sense to spend a negative amount of capital, labour on any activity, so we constraint all the production resource to be non-negative. They are unknown values or activities to be determined. Slack Variables; Also known as disposable variables, they are variables included in the mathematical procedure of simplex method which are non-negative and which transformed the inequalities in the constraint equation to equalities.

Basic Variable; A variable is said to be a basic variable in a given equation if it appears with a unit coefficient in

that equation and zeros in all other, otherwise it is nonbasic. Basic Solution; The solution obtained from a canonical system by setting the non-basic to zero and solving for the basic variable. Feasible solution; A solution is said to be feasible when it satisfies all the constraint equations. Basic feasible equation; This is a basic solution in which the values of the basic variables are nonnegative. Basis; The levels of constraints and unutilized

constraints in any one solution form a basis. Entering variable; This is also called incoming activity, that must be introduced in the basis.

 Leaving variable; This is the element or variable at the intersection of the incoming activity and outgoing variable or activity. Pivot row; This is the row that will be occupied by the incoming activity, that the place of the outgoing activity.

ASSUMPTIONS OF LINEAR PROGRAMMING In linear programming, the following assumptions are made. PROPORTIONALITY ASSUMPTION; This assumption indicates that the level of each activity is directly proportional to the quantity of the material resources in that equation. In view of this, if one wants to increase the effect of that activity by one unit, he/she just increases the level by one unit.

ADDITIVITY ASSUMPTION; It is assumed that the total profitability and the total amount of each resource utilized would be exactly equal to the sum of the respective individual amounts. Thus, the function or the activities must be additive and the interaction among the activities of the resources does not exist. DIVISIBILITY ASSUMPTION; Variables may be assigned fractional values i.e they need not always be integers. If a fraction of a product cannot be produced, an integer programming problem exists. CERTAINTY ASSUMPTION; It is assumed that conditions of certainty exists i.e all the relevant parameters or coefficients in linear

programming model are fully and completely known and that they do not change during the period. However, such an assumption may not hold good at all times.

FINITENESS; Linear programming assumes the presence of a finite number of activities and constraints without which it is not possible to obtain the optimal solution. THE STANDARD-LINEAR PROGRAMMING The standard form of a linear programming problem with m-constraint equations and n-decision variables can be represented as follows;

Max(min) subject to Where A = {a ij }

Z =C 1 1 x Ax b

b = { 1,b 2,...,b b Xi 0

X = {X 1 X 2 ,..., , X
m

CHAPTER TWO METHOD OF DATA COLLECTION Data collection is an activity aimed at getting

information to satisfy some decision objectives. The data collection can be done through experiment, questionnaire, personal interview, survey e.t.c. However, the data used in this study was collected from the Deputy Manager, Feed Mills Department of the case study (Phinomar Farms, Ltd, Ngwo, Enugu) on the raw materials used and the amount of feed produced via recorded data and means of interview. Problems Encountered The problems encountered in this study was mainly the sourcing of the materials the researcher actually needed, like the production quota and total raw materials used for feed production.

Also the time of going from school amidst lectures to the farm in Enugu was a major challenge. Finally, some of the data gotten had to be processed as they were in its very raw state. The researcher was able to do this through some very important conversions in order to get the desired and accurate results.

Data Presentation

Let; 1 unit = 10bags of broiler feed (for all three activities

Input (kg)

Cost of Production Raw materials Selling price Profit

Activity 1 Activity 2 Activity 3 Activity(Products)18054.98 13343.06 18854.12 Availability 22500 22000 19000 of raw5656.94 3645.88 3945.02
materials Starter feed X2 113.5 25 5.3 62.5 25 6.3 2.9 3.5 8 0.5 Finisher feed X3 83.8 50 35 33.8 8.5 1 2.3 10 0.5

Pre-starter feed X1 114.5 25 12 62.5 12.5 3 3 3 0.5

Maize G/Corn Fish meal Soya meal Full Fat Soya Soya Oil DCP Limestone Wheat Offal Methionine liquid (litres) Acidomix Acid

401.9 261 90 237 102 28 36 19 30 12

0.5

15

INPUT PRICES AND THE PROFIT MADE

METHODOLOGY

THE SIMPLEX METHOD; The Simplex method is an iterative technique starting with known basic feasible solution to a new decision variable called the entering variable and the selection of another variable called the leaving variable to leave the basis and finally calculate the solution that optimized the objective function. Because each successive solution improves upon the current one, it is not possible to consider the same solution twice and the procedure terminates in a finite number of iteration, since it embodies a sequence of specific instruction. Outline of the Simplex method Initialization steps; Identify an initial basic feasible solution. Firstly, we introduce slack variables Sis (i= 1,2,3,,n), then select the original variable Xis (i=1,2,3,,n) to be the initial non-basic variables, then set them equal zero and the slack to initial

basic variables. When solving, it is convenient to use the following procedure; Iterative Step; This involves moving to the better adjacent basic feasible solution. The iterative steps are in part. Part 1; Determine the entering variable by selecting the variable (automatically the non-basic variable) with the largest negative coefficient. That is the non-basic variable that will increase the objective function Z at its fastest rate. We indicate the variable with a pivotal point and indicate the column (pivotal column). Part 2; Determine the leaving basic variable by; I. Picking out each coefficient in the basic column that is strictly positive greater than zero. II. Divide each of these coefficients of the entering variable with the coefficient of the right-hand side (bvalue) for the same row.

III.

Identify the equation (row) that has the smallest ratio of the quotient.

IV.

Select the basic variable for the equation (this is the basic variable that reaches zero first as the entering basic variable is increased). Put a box around this row in the tableau to the right of Z column and call the boxed row the pivot row.

Part 3; Determine the new basic feasible solution by repeating the same procedure in part 1 and part 2 in the simplex tableau below the current one. The first other columns are unchanged except that the leaving basic variable in the first column is replaced by the entering basic variable. The new pivot numbers =

oldpivotnumber pivotnumber

Part 4; Stopping rule: Stop when an adjacent feasible Z solution is better. The current basic feasible solution is

optimal if and only if every coefficient in the basic variable of the Z equation is non-negative. Fundamental Condition of the Simplex Method The basis for simplex method which guarantees the generation of such a sequence of basic feasible solution is based on 1.Feasibility Condition; This guarantees that starting with basic feasible solutions; only basic feasible solutions are encountered during computation and iteration. 2.Optimality Condition; This ensures that no inferior solutions relative to the current solution are encountered during computation and iteration. Sensitivity Analysis Sensitivity analysis in Linear Programming refers to changes in the parameters (input data) within limits

without causing the optimal solution to change. The parameters of LP models are usually not exact. With sensitivity analysis, we can ascertain the impact of this uncertainty on the quality of the optimal solution. The changes in the LPP can be considered in four types; 1. Changes in the objective function 2. Addition of a new variable 3. Changes in the constant column vector 4. Addition of a new variable to the problem

Duality Theory The dual problem is an LP defined directly and systematically from the primal (or original) LP model. The main focus of a dual problem is to find for each resource its best marginal value. This value (also

called the shadow price) reflects the scarcity of the resources. If a resource is not completely used i.e there is no slack, then its marginal profit is zero. The format of the Simplex method is such that solving one type of problem is equivalent to solving the others simultaneously as they both provide optimal solutions to each other. (Sharma 2009). Thus the primal in matrix notation is

MaximizeZ = CX subject to: AX b X 0

The dual problem is constructed as
MinW = bY subject to: AY C

Y0
Relationship between the primal and dual problem 1. The objective function coefficients of the primal problem have become the right-hand side

constraint value of the dual. Furthermore, the right-hand side constraint of the primal has become the cost coefficient of the dual. 2. The inequalities have been reversed in the constraint 3. The objective function is changed from

maximization to minimization (and vice versa). 4. Each column in the primal corresponds to a constraint (row) in the dual. Thus, the number of dual constraints is equal to the number of primal variables. 5. Each constraint (row) in the primal corresponds to a column in the dual. 6. The dual of a dual is the primal problem. (Advanced Statistics for Higher Education. A.I Arua et al).

CHAPTER THREE DATA ANALYSIS The study uses Linear Programming (LP) technique to determine the optimum level of profit for the three brands of broiler feeds. Sensitivity analysis is applied to the objective

function coefficients and resource vector in order to determine how robust the optimal solution is. Linear programming model for Phinomar Farms, Nigeria Limited The farm produces 3 brands of broiler feeds which have some limitations (raw materials and demand). All these amount to 11 constraints. Hence, the model for Phinomar Farm is n = 3 decision variables and m = 11 constraints. Thus;
Maximize Z = C1 X 1 + C2 X 2 + C3 X 3 subject to a11 x1 + a12 x2 + a13 x3 b1 a21 x1 + a22 x2 + a23 x3 b2 . . . a111 x1 + a112 x2 + a113 x3 b11 xi 0,i =1,2,3 bi 0,i =1,2,3,...,11

The Model

The model for the three brands of broiler feeds in Phinomar Farms, Nigeria Limited is given below;
MaximizeZ = 3645.88 x1 + 3945.02 x2 + 5656.94 subject to constraint 1; 114.5x1 + 113.5 x2 + 83.8 x3 401.9 constraint 2; 25.0x1 + 25.0 x2 + 5.0 x3 261.0 constraint 3; 12.0 x1 + 5.3 x2 + 9.0 constraint 4; 62.5x1 + 62.5 x2 + 35.0 x3 237.0 constraint 5; 12.5 x1 + 25.0 x2 + 33.8 x3 102.0 constraint 6; constraint 7; constraint 8; constraint 9; constraint10; 0.5 x1 + constraint11; 1.0 x1 + 3.0 x1 + 3.0 x1 + 3.0 x1 + 6.3x2 + 8.5 x3 36.0 2.9 x2 + 1.0 x3 28.0 3.5 x2 + 0.5 x2 + 1.0 x2 + 2.3 x3 19.0 0.5 x3 12.0 1.0 x3 15.0 8.0 x2 + 10.0x3 3.0

For all

xi 's 0 where i =1,2,3

Then introducing the slack variables

MaximizeZ = 3645.88 x1 + 3945.02 x2 + 5656.94 subject to constraint 1; 114.5x1 + 113.5 x2 + 83.8 x3 + x4 401.9 constraint 2; 25.0x1 + 25.0 x2 + 5.0 x3 + x5 261.0 . . . constraint11; 1.0 x1 + 1.0 x2 + . . . . . . . . .

1.0 x3 + x14 15.0 xi 's 0 where i =1,2,3

x4, x5,... x14

are the positive slack variables commonly referred to

as Surplus (of the LHS over the RHS)

CHAPTER FOUR ANALYSIS OF RESULT, CONCLUSION AND RECOMMENDATION The Tora output of the linear programming model for Phinomar Farms is divided into two major sections, namely 1. The Optimum Solution Summary 2. Sensitivity analysis

Optimum Solution Summary This part is sub-divided into three parts; the first displays the number of iterations (three in this maximization problem) that gave the maximum objective function of 19843.85. The second part gives the maximum values of the maximized variables; namely 1.78 Units of Pre-Starter broiler feed and 2.36 Units of finisher broiler feed. However, the second variable; Starter broiler feed did not contribute anything at all. Also shown are the relative profit coefficients of the activities (variables) in the objective function and their respective contributions. Pre-Starter broiler feed made a profit of 6505.67 and the Finisher broiler feed made a profit of 13338.18, while the Starter broiler feed did not contribute any profit at all. Thus, Phinomar farms will make a profit of 19843.85 if they produce at the specified quantities excluding the Starter broiler feed for every 1unit.

The last section of this Optimum Solution Summary accounts for the current right-hand-side values of the variables and their slacks(-). There are no surpluses since all the constraints are of the type. These slacks are the amounts by which the constraints are over-satisfied. Sensitivity Analysis The Sensitivity analysis section of the output deals with individual changes in the coefficient of the objective function and the right-hand-side of the constraints. The specified limits define the boundaries which the variable must not exceed for the solution to remain optimal. For instance, the profit of Starter broiler feed can be reduced to 2092.06 but must not exceed 7729.35 when its been increased with other products still being produced. Also, the current optimal solution will remain unchanged so long as the right-handside of Maize and Full Fat Soya lies between (256.90,474.28) and(43.88,112.19) respectively.

In this Sensitivity section, there are the reduced costs and the dual price which are of significance to any profitmaximizing firm. The reduced cost per unit activity can be defined as cost of consumed resources per unit less revenue per unit. If the activity reduced per unit is positive, then its unit cost of consuming a resource is higher than its unit profit and such activity should be given less attention. It implies that the variables with zero-reduced cost can be produced without making loss. Thus, the Pre-Starter and the Finisher broiler feeds can be produced without making loss at this one unit. The dual price, also known as the shadow price, measures the unit worth of the resources i.e. the contribution of the objective function of a unit increase or decrease in availability of the resources. Specifically, the zero dual prices associated with constraints at (2, 3, 4, 6 11) implies that they are in excess. Hence, an increase in any of them brings no economic profit. Also, the dual price corresponding to

constraints (1, 5) is an indication that a unit increase or decrease in the availability of Maize and Full Fat Soya will add 18.61 and 121.23 to the total profit respectively and reduces the total profit by the same amount.

CONCLUSION From the analysis we see there is need for the farm to employ the use of Linear Programming technique and the aid of Operations researchers to keep the farm up and doing. For the farm to maximize profit, they should produce more of X1 and X 3 (Pre-Starter and finisher broiler feed). This solution indicates that the farm should produce Pre-Starter,

Starter and Finisher broiler feed at the rate of 1.78, 0.00 and 2.36 respectively for every 1unit with a resulting profit of 19843.85.

RECOMMENDATION Based on the findings of this research, the following recommendations are made;

In order to maximize profit, the resources of broiler feed should be combined in the best optimum way. That is, the decision variables (X1,X3) should be combined in their best optimum way. If the farm still wants to go into

the production of variable X2 (Starter broiler feed), it can ensure the product becomes profitable by; A. Increasing the revenue by increasing the price of the product B. Decreasing the cost of consumed resources (raw materials). Some raw materials are in excess and it is advisable for the farm to make maximum use of these resources in such a way that waste will be minimized. The Sensitivity parameters of the model for the research work, that is, the unit profit of the decision variables and the resource input should be ensured that they do not exceed their boundaries. However, if it becomes impossible to control them within these limits, then the solution should be changed.