Cost Estimation of Bandage Production Using Simplex Method

Abstract

A key problem faced by managers is how to allocate scarce resources among activities or projects. Linear programming, or LP, is a method of allocating resources in an optimal way. It is one of the most widely used Operations Research (OR) tools. Using LP, the system helps the management to decide how to allocate the limited resources to maximize profits. This paper will support the bandage production for a factory by using simplex method, sensitivity analysis and dual simplex method. To get maximum profit and minimum cost, the paper uses the simplex method, which is one of multidimensional unconstrained optimization without derivative methods to search for optimal parameters in product and process design. Options are available which can provide additional information and analysis on problems by using sensitivity analysis. And then calculate by using dual simplex method to get post-optimal solution.