Management question

Part 1: a) Define the decision variables,

  1. b) Objective function,and
  2. c) Constraints.

You don’t need to solve the following problems ( #23, #27, #40, and #44)

Problem #23 (P 120)

Problem #27 (P122)

Problem #40 (P 128): Try problem #39 (P 128), similar toproblem 40, and the #39 answer key posted on

the blackboard.

Problem #44 (P 130)

  1. a) Define the decision variables.
  2. b) Define the objective function.
  3. c) Define the constraints.

Part 2:

Fidelity Savings & Loans (FSL) operates several banking facilities throughout North Dakota.

The FSL wants to determine its branch efficiency using DEA. FSL collected the following data. Output (R.O.A, New Loans, and Satisfaction) and input (Labor Hours and Operating Costs).

Compute the DEA efficiency for branch 3.

Branch ROA New Loans Satisfaction Labor Hours Op. Costs
1 5.32 770 92 3.73 6.34
2 3.39 780 94 3.49 4.43
3 4.95 790 93 5.98 6.31
4 6.01 730 82 6.49 7.28
  1. a) Define the decision variables.
  2. b) Define the objective function.
  3. c) Define the constraints.

Part 3: Determine the optimal solution using Solver or Analytic solver.

Pi = number of units to produce in month i ( i= 1,2,3,4)

Ii = inventory held at the end of month i

MIN49 X1 + 45 X2 + 46 X3 + 47 X4 + 1.5 (120 + 2I1+ 2I2 + 2I3 + I4)/2

STI1 = 120 + P1 – 420

I2 = I1+ P2 – 580

I3 = I2+ P3 – 310

I4 = I3+ P4 – 540

400 P1 500

400 P2 520

400 P3 450

400 P4 550

I1,I2,I3,I4 50