Building DSS Using Excel

Method
o What-if
o Trial and Error
o Goal Seeking
o Solver
Examples
Problems

Tavana : EXL-1
 DSS Building Methods in Excel
METHOD GOAL INPUT OUTPUT

Examine a Number of
WHAT-IF Decision Maker (DM) Enters Excel Calculates
Alternative Outcomes

DM Tries Different Values

TRIAL & ERROR To Obtain a Specific Result Until He/She Obtains the Excel Calculates
Specified Result

Excel Calculates Values for

GOAL SEEK To Obtain a Specific result Decision Maker Specifies
one Input Cell

Excel Calculates Optimal DM Specifies Whether

To Obtain an Optimal
SOLVER Values for Multiple Input He/She Wants to Maximize
Result
Cells or Minimize

Tavana : EXL-2
 Goal Seeking

Data Tab

Goal Seek

Solver

Data Tab
Solver

Tavana : EXL-3
Larry Powell is the general manager of the American Appliances. Larry
has received information from Gold Star Corporation about special
dealer pricing on selected models of Gold Star refrigerators, stoves, and
microwave ovens. Refrigerator Model R100, which usually costs $935
wholesale, is $850. The Gourmet Model S200 stove, which usually costs
$450 wholesale, is $420. And the popular Model M300 microwave,
which usually costs $220 wholesale, is $195. This looks like a great
opportunity to stock up on some fast-moving merchandise and to
increase profit. Larry asks his sales manger about the retail prices of
each item. Model R100 refrigerator has a retail price of $1,250 and there
are 6 existing customer orders. Model S200 has a retail price of $595 and
there are 14 existing customer orders. And Model M300 microwave
oven has a retail price of $250 and there are 19 customer orders. From
his inventory Larry learns that each of these apartment-sized refrigerators
requires 25 cubic feet of storage space. Each stove requires 18 cubic
feet of storage space and each microwave oven requires only 3 cubic
feet of storage space. After talking to the warehouse manager, Larry
realizes that the entire order must fit in 1,300 cubic feet of storage space.
Given a total budget of $50,000 for the order, how many refrigerators,
stoves, and microwave ovens should be ordered.
Tavana : EXL-4
 American Appliances
Initial Solution
Refrigerators Stoves Microwaves
Unit Wholesale Cost $850 $420 $195
Unit retail Price $1,250 $595 $250
Profit Per Unit $400 $175 $55
Cubic Feet Per Unit 25 18 3

Customer Orders 6 14 19
Quantity To Order 6 14 19

Total Revenue $7,500 $8,330 $4,750

Total Cost $5,100 $5,880 $3,705
Total profit $2,400 $2,450 $1,045
Total Cubic Feet 150 252 57

TOTAL ORDER COST $14,685

TOTAL ORDER PROFIT $5,895
TOTAL SPACE REQUIRED 459
http://tavana.us/american.xls

Tavana : EXL-5
 What-if Analysis
What-if unit price for microwaves is increased to $300?
Refrigerators Stoves Microwaves
Unit Wholesale Cost $850 $420 $195
Unit retail Price $1,250 $595 $300
Profit Per Unit $400 $175 $105
Cubic Feet Per Unit 25 18 3

Customer Orders 6 14 19
Quantity To Order 6 14 19

Total Revenue $7,500 $8,330 $5,700

Total Cost $5,100 $5,880 $3,705
Total profit $2,400 $2,450 $1,995
Total Cubic Feet 150 252 57

TOTAL ORDER COST $14,685

TOTAL ORDER PROFIT $6,845
TOTAL SPACE REQUIRED 459

An increase of $950 in Total Order Profit. Tavana : EXL-6

 Trial and Error

How many refrigerators to order without exceeding cost

limit of $15,000 and space limit of 450 cubic feet?

Goal:
Find the Highest Quantity to Order (Refrigerator)
Subject to:
Total Cost (Refrigerator) 15000
Total Space (Refrigerator) 450

Tavana : EXL-7
 Trial and Error
10, 15, 20, .........., 17
Refrigerators Stoves Microwaves
Unit Wholesale Cost $850 $420 $195
Unit retail Price $1,250 $595 $250
Profit Per Unit $400 $175 $55
Cubic Feet Per Unit 25 18 3

Customer Orders 6 14 19
Quantity To Order 17 14 19

Total Revenue $21,250 $8,330 $4,750

Total Cost $14,450 $5,880 $3,705
Total profit $6,800 $2,450 $1,045
Total Cubic Feet 425 252 57

TOTAL ORDER COST $24,035

TOTAL ORDER PROFIT $10,295
TOTAL SPACE REQUIRED 734

Tavana : EXL-8
 Goal Seeking

Assuming that we want to make $5,250 profit on Stoves, how

many should we order?

Goal:
Profit (Stove)

Value:

$5,250
By Changing Cell:
Quantity to Order (Stove)

Tavana : EXL-9
 Goal Seeking

Refrigerators Stoves Microwaves

Unit Wholesale Cost $850 $420 $195
Unit retail Price $1,250 $595 $250
Profit Per Unit $400 $175 $55
Cubic Feet Per Unit 25 18 3

Customer Orders 6 14 19
Quantity To Order 6 30 19

Total Revenue $7,500 $17,850 $4,750

Total Cost $5,100 $12,600 $3,705
Total profit $2,400 $5,250 $1,045
Total Cubic Feet 150 540 57

TOTAL ORDER COST $21,405

TOTAL ORDER PROFIT $8,695
TOTAL SPACE REQUIRED 747
Tavana : EXL-10
 Solver Parameters

Given the $50,000 total budget and 1300 cubic feet space constraints,
how many Refrigerators, Stoves, and Microwaves should be ordered to
Maximize profit?

Goal:
Max. Profit
By Changing:
Quantity to Order (Refrigerator, Stove, Microwave)
Subject to:
Total Order Cost 50000
Total Space Required 1300

Tavana : EXL-11
 Excel Solver 2010

Uncheck Uncheck

Tavana : EXL-12
Excel Solver 2007

Tavana : EXL-13
 Solver Results
Refrigerators Stoves Microwaves
Unit Wholesale Cost $850 $420 $195
Unit retail Price $1,250 $595 $250
Profit Per Unit $400 $175 $55
Cubic Feet Per Unit 25 18 3

Customer Orders 6 14 19
Quantity To Order 31 14 91

Total Revenue $38,750 $8,330 $22,750

Total Cost $26,350 $5,880 $17,745
Total profit $12,400 $2,450 $5,005
Total Cubic Feet 775 252 273

TOTAL ORDER COST $49,975

TOTAL ORDER PROFIT $19,855
TOTAL SPACE REQUIRED 1300
Tavana : EXL-14
The Heinrich Company manufactures two types of plastic hanger
racks (Foldaways and Straightaways) especially suited for mounting
near clothes dryers. Because permanent press clothing must be hung
on hangers immediately after removal from the dryer, these items have
been especially popular. However, there is some concern that the
Preppie movement (popularized by its own handbook) will extinguish
polyester clothing; Heinrich is terribly interested in doing the best with
the resources it has while its products are still in demand. The first
type of hanger rack, the Foldaway, requires 10 ounces of plastic
material and 0.3 hours of labor. Plastic costs Heinrich 10 cents an
ounce; labor costs Heinrich $20 per hour. The second type of hanger
rack, the Straightaway, requires 15 ounces of plastic and 0.175 hours
of labor. The prices of these resources are the same as those for the
Foldaway. Under current market conditions, Heinrich can sell the
Foldaway for $12 and the Straightaway for $11. Heinrich is unable to
hire more than 350 hours of labor a week, or buy more than 50,000
ounces of plastic a week. How many Foldaways and Straightaways
should Heinrich produce to maximize their profit. Tavana : EXL-15
Heinrich Company
Spreadsheet Structure

Tavana : EXL-16
Heinrich Company
Initial Spreadsheet

Tavana : EXL-17
Heinrich Company
Solver Parameters

Tavana : EXL-18
Heinrich Company
Optimal Solution

Tavana : EXL-19
 Francois Stealth
Francois Stealth, the international terrorist, has decided that the
world has ignored his groups demands long enough. He has
decided to show the world that he is a man to be reckoned with
and is planning to get the worlds attention by developing a few
nuclear bombs. But he first has to work out the logistics. Not
even terrorists can get away with bad planning. Francois has
decided that he will spend up to $15,000,000 to achieve his
objective of causing as many fatalities as possible. He knows he
can get up to 40 lbs of weapons grade uranium from an ex-KGB
agent who is now making his living off of the Ukrainian black
market. Francois wants to make sure that he gets credit for his
devious plan, so he decides that it has to take place on
September 20th, his groups 5th anniversary. He figures that this
will give him 90 days to make as many bombs as he can.
Francois has collected the following information about each
bomb:
Tavana : EXL-20
 Francois Stealth

Types of bombs
100 megaton 500 megaton 1000 megaton
Cost $500,000 $2,000,000 $2,300,000
Lbs of Uranium required 1 4 8
Days of labor 15 7 3
Fatalities 1,000,000 3,300,000 4,000,000

Francois wants to know how many 100, 500, and 1000

megaton bombs he needs to produce to maximize total
fatalities.

Tavana : EXL-21
Francois Stealth
Initial Spreadsheet

Tavana : EXL-22
Francois Stealth
Solver Parameters

Tavana : EXL-23
Francois Stealth
Optimal Solution

Tavana : EXL-24
 Titanic Cruise Company

Titanic Cruise Company plans on releasing its new Superliner cruise ship in time for
the peak Spring cruise season. The Superliner is the largest and most expensive cruise
ship ever built. The ship will be longer than 4 football fields. The ship has amenities that
were never possible before on a commercial cruise ship. Features include rock climbing
walls, skydiving simulators, an open air atrium version of Central Park, and nearly two
dozen specialty restaurants.

Sinbad the Sailor, the President and CEO of Titanic, wants to figure out which itinerary for
the ships 17 day maiden voyage will be most profitable. He began by selecting a list of
ports for the ships maiden voyage. He then projected 358,000 dollars daily onboard
revenue for each port based on the maximum passenger capacity. In addition, he
projected daily shore excursion revenue for different ports. Finally, he projected all of the
daily expenses for each port including docking fees, local taxes, fuel costs, labor costs,
and supplies and raw materials.

Sinbad must consider two basic constraints when planning the itinerary. First, the ship
must stay at least one day at each of the target ports listed because partial-day
scheduling is not feasible. Second, the ship cannot spend more than 3 days in any
individual target port because maritime regulations and individual port guidelines prevent
longer stays. Use the information provided in the next table and help Sinbad find the most
profitable itinerary for the ships maiden voyage.
Tavana : EXL-25
 Titanic Cruise Company

Daily Shore Daily Daily

Daily Fuel Daily Labor Daily Supplies
Port Excursion Docking Local
Costs Costs and materials
Revenue Fees Taxes
Aruba $25,897 $14,258 $1,189 $1,237 $98,230 $76,390
Bahamas $41,777 $45,221 $635 $1,587 $107,250 $85,250
Barbados $35,789 $86,254 $526 $1,897 $102,370 $68,730
Jamaica $37,899 $52,899 $428 $2,750 $96,320 $88,220
Miami $25,894 $72,899 $1,199 $1,674 $102,390 $74,380
San Juan $42,879 $88,524 $458 $2,584 $106,450 $73,470
St Croix $32,874 $12,455 $850 $4,125 $104,350 $89,230
St Martin $24,897 $72,158 $254 $1,528 $102,890 $82,760
St Thomas $28,597 $62,548 $1,026 $1,458 $109,370 $78,390
St. John $38,974 $12,685 $899 $1,426 $93,480 $92,650

http://tavana.us/titanic.xls
Tavana : EXL-26
Titanic Cruise Company
Initial Spreadsheet

Tavana : EXL-27
Titanic Cruise Company
Solver Parameters

Tavana : EXL-28
Titanic Cruise Company
Optimal Solution

Tavana : EXL-29
 Planters Nut Company
Planters Nut Company is planning to launch a new 32-ounce can of mixed
nuts. The product will be a mix of Cashews, Almonds, Walnuts, Pecans,
Brazil Nuts, Macadamia Nuts, Peanuts and Pistachios. The specific mix of
these varieties will depend on several factors:
The amount of fat per serving should not exceed 33.50 grams - each
serving size is 2 ounces.
There must be at least 2 ounces and no more than 7 ounces of
each nut in the mix.
Given the following cost and fat per ounce for each variety, how many
ounces of each nut should be used in the new 32-ounce can to minimize the
total cost of each can?
Nut Type Cost Per oz. ($) Fat Per oz. (g)
Cashews $0.45 13
Almonds $0.30 15
Walnuts $0.35 18
Pecans $0.15 20
Brazil Nuts $0.30 19
Macademia Nuts $0.55 22
Peanut $0.15 14
Pistachios $0.60 13
http://tavana.us/planters.xls Tavana : EXL-30
Planters Nut Company
Initial Spreadsheet

Tavana : EXL-31
Planters Nut Company
Solver Parameters

Tavana : EXL-32
Planters Nut Company
Optimal Solution

Tavana : EXL-33
Many young people moving into apartments and new homes look forward to the
excitement of furniture shopping. These young shoppers are usually interested in
cheaper, build yourself furniture, however, many of them are not too handy and the
excitement quickly dissipates as they start putting their furniture together. The
instructions, even if they are in English, are difficult to understand and the consumer
soon realizes that the savings may not be worth the hassle.

Built-4-U is an online furniture company that caters to those customers. Built-4-U

buys build yourself furniture directly from manufacturers at a discount price,
assembles each piece at their warehouse, and then ships directly to their customers.
Each customer can order their furniture online without ever having to leave their
home or search for the right tool to assemble. Joe Builder, the owner and CEO of
Built-4-U, plans to establish their beginning inventory by investing a maximum of
$35,000 on 25 popular items. The website for Built-4-U is scheduled to go live shortly
and all 4 inventory clerks were advised they might have to work five, 10 hour days
prior to the grand opening to assemble this startup inventory. Joe believes he should
order no less than 5 and no more than 20 units of each item. In addition, the
manufacturer has a minimum truck order of 6,000 pounds. Given the following
information, help Joe decide how many units of each item to order.
Tavana : EXL-34
 Built-4-U
Item Wholesale Price Retail Price Weight Minutes of Assembly
Oak Cabinet 209.00 369.00 35 80
Oak Low Chair 49.00 99.00 12 25
Oak Gateleg Table 249.00 449.00 39 90
Oak Buffet with Top Cabinet 179.00 339.00 30 90
Oak Buffet 159.00 299.00 28 65
Oak Chair 59.00 109.00 13 20
Black Cherry Sideboard 209.00 399.00 35 90
Black Cherry Wall Cabinet 129.00 239.00 23 45
Black Cherry Dining Table 209.00 399.00 35 90
Black Cherry Chair 59.00 109.00 13 20
Black Cherry Coffee Table 119.00 229.00 22 50
Black Cherry Coffee Table Oval 99.00 189.00 19 45
Maple Round Coffee Table 99.00 189.00 17 45
Maple Oval Coffee Table 89.00 179.00 18 45
Maple Visitor Chair 89.00 179.00 20 45
Mahogany Chair 69.00 149.00 15 45
Mahogany Low Chair 59.00 119.00 14 20
Resewood Chair 55.00 109.00 13 20
Rosewood Wardrobe 209.00 379.00 35 70
Rosewood Linen Cupboard 139.00 269.00 25 65
Rosewood Chest with 3 Drawers 139.00 269.00 28 70
Rosewood Chest with 7 Drawers 499.00 879.00 82 90
Rosewood Wardrobe with 3 Doors 289.00 499.00 46 75
Rosewood Wardrobe with Sliding Doors 329.00 559.00 51 75
Rosewood Bed with Storage 179.00 319.00 32 65

http://tavana.us/Built-4-U.xls
Tavana : EXL-35
 Built-4-U
Initial Spreadsheet

Tavana : EXL-36
 Built-4-U
Solver Parameters

Tavana : EXL-37
 Built-4-U
Initial Optimal Solution

Tavana : EXL-38
 Built-4-U
Revised Optimal Solution

Tavana : EXL-39
Donald Tramp, CEO of Golden Palace Casino, the leading online casino is interested in
allocating resources to satisfy the demand of their players and maximize profits.

The main challenge is to allocate no more than 140 hours available for play among tables with
different pot sizes. Tables with low pot sizes do not generate as much money as those with
high pot sizes, however the low pot size tables have a greater frequency of play and the
hourly expenses are lower because they do not require as much service.

The low pot size tables also have a higher house intake (the percentage that the casino takes
from the players) compared to the high pot tables. There are also restrictions on how many
hours can be allocated to each table. Donald has set a maximum restriction on the number of
tables for each pot size for maintenance and security reasons. He has also set a minimum
restriction on the number of tables in order to satisfy customer demand. In addition, he has
set minimum and maximum restrictions on the number of hours that should be allocated to
each table for similar reasons. Given the information provided below, help Donald find the
number of hours to allocate to each table for each pot size and the number of tables to
allocate for each pot size so he can maximize his profit.

Tavana : EXL-40
 Golden Palace Casino

Table Blind Ave. Pot House Intake Pots Per Hour Hourly Expense Min Hours Max Hrs. Min Tables Max Tables
2 100 0.0475 70 50 6 9 5 8
5 150 0.0450 50 60 5 8 4 5
10 250 0.0400 40 70 5 7 3 5
20 400 0.0375 30 80 3 5 3 5
100 1500 0.0350 20 100 2 4 2 4
1000 10000 0.0300 10 200 1 2 1 2

http://tavana.us/GoldenPalace.xls

Tavana : EXL-41
Golden Palace Casino
Initial Solution

Tavana : EXL-42
Golden Palace Casino
Solver Parameters

Tavana : EXL-43
Golden Palace Casino
Optimal Solution

Tavana : EXL-44
 Impulse Shopping Network

Taking advantage of consumer weaknesses is what the Impulse

Shopping Network does best. On-air hosts peddle each product
during a predetermined period of time. During each segment
(10 minutes maximum), viewers are enticed to whip out their
credit card and order the product shown before the time runs
out. These marketers are so convincing that even the savviest
consumer cant avoid temptation. Moore Zales, Director of
Marketing at Impulse Shopping Network needs to do some
product planning for tomorrow evenings line-up. She needs to
decide how to split the group of products being offered between
an hour of peak and two hours of off-peak airtime in order to
maximize the profits generated for the three hour line-up. The
following is a list of available items, their wholesale cost, retail
price, stock-on-hand, and data on the quantity sold per minute
in the previous week during both peak and off-peak times.

Tavana : EXL-45
 Impulse Shopping Network
Units Sold Per Minute During Peak Units Sold Per Minute During Off-Peak Stock
Product Wholesale Cost Retail Price
Mon. Tue. Wed. Thu. Fri. Sat. Sun. Mon. Tue. Wed. Thu. Fri. Sat. Sun. On-Hand
Ab Cruncher 14.95 29.95 73 75 79 87 89 94 0 41 42 43 47 0 43 36 700
Am azing Show erhead 10.95 29.95 122 114 109 0 124 128 131 35 36 0 44 32 35 42 600
Auto Ham m er 5.95 22.95 102 0 120 102 98 99 102 46 58 62 57 46 0 53 800
Bug Wand 8.95 25.95 143 0 136 147 157 151 155 74 72 69 0 77 66 69 600
Butt-Blaster Exerciser 70.95 89.95 56 59 61 63 0 62 63 26 34 33 0 28 33 35 900
Butter Butler 2.95 15.95 0 67 72 78 75 89 88 40 27 0 34 31 36 35 800
Cable Flex 74.95 93.95 94 92 0 97 95 101 88 35 36 38 39 41 0 42 700
Clever Cam 34.95 49.95 124 90 0 87 96 96 102 59 0 49 59 75 68 68 900
DrainBuster 3.95 17.95 84 85 89 96 108 111 85 0 44 46 54 51 0 43 800
Euroblaster 6.95 24.95 149 151 171 164 138 144 0 25 25 28 34 27 0 29 900
Eurosealer 10.95 29.95 94 88 84 0 97 98 99 44 45 0 37 43 46 44 700
Flat Hose 16.95 29.95 59 56 0 53 0 66 67 0 43 39 37 36 0 34 800
George Forem an Grill 41.95 59.95 96 0 99 111 102 119 89 45 46 43 47 0 45 47 600
Grip Wrench 5.95 19.95 73 72 0 66 58 84 88 38 38 43 36 0 44 46 900
Magic Mop 8.95 24.95 0 145 0 125 129 126 0 0 78 82 76 57 0 71 600
Roll-Aw ay Flat Hose 14.95 29.95 115 113 132 123 106 0 125 56 57 65 0 48 58 66 700
Sew ing Genie 24.95 39.95 65 73 68 73 82 86 64 32 0 36 39 42 43 32 800
Trim Spa 12.95 29.95 122 118 109 113 0 131 114 63 58 0 63 60 71 56 900
VCR Co-Pilot 14.95 29.95 148 144 169 161 0 146 163 72 75 82 75 0 74 0 700
Wonder Steam er 11.95 29.95 186 171 0 193 195 184 184 98 0 94 96 102 95 96 600
Note: Zero units sold in the above table indicates the product was not shown on-air on a particular day.

http://tavana.us/Impulse.xls

Tavana : EXL-46
Impulse Shopping Network
Initial Solution

Tavana : EXL-47
Impulse Shopping Network
Solver Parameters

Tavana : EXL-48
Impulse Shopping Network
Optimal Solution

Tavana : EXL-49
Ted Healy, owner of Rent-A-Wreck in London wants to select ten cars from
a list of 500 cars available for sale at Used Car Mart, the largest used car
dealer in London. He has asked Larry, Moe, and Curley to assess all the
cars on the list and provide him with a recommendation by the end of the
week. Larry, Teds bookkeeper, is concerned with price and fuel
consumption. He prefers lower priced cars and has never heard of the wise
adage you get what you pay for. He also prefers cars that consume very
little gas. However, Moe, Teds mechanic, is interested in cars with low
recorded total mileage. He also prefers cars with lots of horsepower. He
believes cars with low mileage and lots of horsepower are more reliable
and last longer. Finally, Curley, Teds salesperson loves newer cars, mostly
because of all the attention bestowed upon him by the local ladies as he
cruises the neighborhood to take cars to the car wash and gas station.
Larry, Moe, and Curly have spent most of their time during the past few
days down the shore and have not devoted anytime to this problem. It is
Friday morning and they are beginning to sweat the consequences of their
frivolous activities. In addition, they are definitely the brawns in the family
and not the brains and have absolutely no idea how to consider all of their
preferences at one time. Rescue the three amigos and help them choose
the top ten cars.
Tavana : EXL-50
 Rent-A-Wreck
(Partial Data)

CAR Color YEAR PRICE($) Mileage POWER (HP) Fuel (MPG)

Car-1 White 2010 13400 21000 140 15
Car-2 Red 2009 11400 33000 160 21
Car-3 Black 2008 10600 54000 210 36
Car-4 White 2000 7600 123000 140 15
Car-5 Blue 1997 6000 160000 220 42
Car-6 Green 1998 7000 161000 150 18
Car-7 Silver 2006 9700 69000 170 24
Car-8 Yellow 2009 11600 30000 160 21
Car-9 Brown 2011 12000 17000 160 21
Car-10 Orange 2002 8000 108000 160 21
Car-11 Gold 2000 7400 123000 200 33
Car-12 Olive 2005 10500 74000 150 15
Car-13 White 2008 9700 51000 150 18
Car-14 Blcak 2009 11300 45000 180 27
Car-15 Black 1997 6400 158000 210 36
Car-16 White 2008 10600 48000 160 21
Car-17 Blue 2010 11400 22000 170 24
Car-18 Green 1999 6800 146000 220 42
Car-19 Blue 2007 10900 53000 200 33
Car-20 Green 1999 7400 142000 150 15

http://tavana.us/cars.xls
Tavana : EXL-51
Rent-A-Wreck
Intermediate Solution

Tavana : EXL-52
Rent-A-Wreck
Final Solution

Tavana : EXL-53