Management Science

Assignment # 2
Presented by members of Group# 16
Shahrukh Ahmed Khan (40859)
Fahad Fida (40860)
Danish Khan (21587)
The state agency has a budget of $ 75 Million in the form of grants for projects in the area of
Health from Government. A management review team consisting of Doctors, Pharmacists &
food technologist and bureaucrats initiates study to identify the problems related to health face
by the citizens and to access that which key functions and areas needed to work for or to make
them work with full capacity to prevent these diseases and illness. Management reviewed
different functions of health in terms of the most needed to the citizens and they have
identified with the most mandatory eight needed functions for development and budget
release which needs to be done on urgent basis. Each of the function have been evaluated and
scored in relation to the health diseases occurred from it to citizens due to the unavailability or
lacking of proper functionality of these projects cause of many reasons. The estimated health
diseases ratio causes to the people in the state from each of the area is given below:

Health disease ratio Requested level of

Functions/Area in citizens (%age) funding ($ in millions)
Food authority 10 10
District Health Authority 11 12
Provision of medicines 9 15
Free dialysis facilities 4 7.2
Primary & Secondary healthcare 8 10.8
Clean water program 17 24
Lady Health program 7 9
Laboratories 6 8

Above table also shows the requested level of funding asked from respective departments
related to health state agency. These figures represent the maximum amount, which will be
awarded to any project. The agency can give any amount up to the indicated maximum for a
given project. Similarly, Primer of the state mandated that the clean water program should be
given at least 60% of the requested amount.

Following constraints should also be considered,

1. Combined funding for the food authority, district health authority and provisions of
medicines should be at least $22 million.
2. Each project should receive at least 25% of the requested amount.

Formulate a LP model to determine the amount of money to be awarded to each of the project
in order to minimize health diseases ratio.
 C= 0.086X1 + 0.11X2 + 0.09X3 + 0.04X4 + 0.08X5 + 0.17X6 + 0.07X7 + 0.06X8

s.t : X1 + X2 + X3 + X4 + X5 + X6 + X7 + X8 <= 75
X6 >= 14.4
X1 + X2 + X3 >= 22
X1>= 2.5
X2>= 3
X3>= 3.75
X4>= 1.8
X5>= 2.7
X6>= 6
X7>= 2.25
X8>= 2
X1<= 10
X2<= 12
X3<= 15
X4<= 7.2
X5<= 10.8
X6<= 24
X7<= 9
X8<= 8

Solution

Optimal Values of Variable :

Allocated budget after management review

Functions/Area
($ in millions)
Food authority 10
District Health Authority 3
Provision of medicines 9
Free dialysis facilities 1.8
Primary & Secondary healthcare 2.7
Clean water program 14.4
Lady Health program 2.25
Laboratories 2
Slacks/Surplus and the objective function

Slack 1 29.85
Surplus 4 7.5
Surplus 6 5.25
Surplus 9 8.4
Slack 15 5.4
Slack 16 8.1
Slack 17 9.6
Slack 18 6.75
Slack 19 6
Optimal Value (Z) 5.0135

Slack 1 29.85 budget left after allocation from 75 Million

Surplus 4 7.5 Additional 7.5 Million provided to Food Authority due to constraint that Combined
funding for the Food Authority, District Health Authority and Provisions of Medicines
should be at least $22 million
Surplus 6 5.25 Additional 5.25 Million provided to Provision of Medicine due to constraint that
Combined funding for the Food Authority, District Health Authority and provisions of
Medicines should be at least $22 million
Surplus 9 8.4 Additional 8.4 Million provided to clean water program due to constraint that Primer
requested that it should be given at least 60% of demanded budget which is 24
Million. 14.4 Million is allocated which should have been 6 million which is 25% of
demanded 24 Million, so additional 8.4 Million provided in Prime Minister request
Slack 15 5.4 5.4 million saved after allocation of 1.8 million from demanded 7.2 Million (Free
dialysis facilities )
Slack 16 8.1 8.1 million saved after allocation of 2.7 million from demanded 10.8 Million (Primary
& Secondary healthcare)
Slack 17 9.6 9.6 million saved after allocation of 14.4 million from demanded 24 Million (Water
Program )
Slack 18 6.75 6.75 million saved after allocation of 2.25 million from demanded 9 Million (Lady
Health Worker Program )
Slack 19 6 6 million saved after allocation of 2 million from demanded 8 Million (Laboratories )
Solving Equation for optimal solution

Health disease Allocated budget

Variable
Functions/Area ratio in citizens after management
Total
(%age) review ($ in millions)
Food authority 0.09 10 0.86
District Health Authority 0.11 3 0.33
Provision of medicines 0.09 9 0.81
Free dialysis facilities 0.04 1.8 0.072
Primary & Secondary healthcare 0.08 2.7 0.216
Clean water program 0.17 14.4 2.448
Lady Health program 0.07 2.25 0.1575
Laboratories 0.06 2 0.12
Optimal Solution after solving equation 5.0135