Merlion LuxBus Pte Ltd provides point-to-point coach services between Singapore and various
Cities in Malaysia. It competes based on differentiated luxury and on-time services. It owns a
fleet of 12 buses, each with a capacity of only 24 passengers in a 2 is to 1 seating arrangement
per row and up to 8 rows. This allows the seats to be nearly fully reclined with good leg room
for passengers.

Singapore is the hub of Merlion’s operations. Point-to-point travel service means that buses
will depart in the morning for a Malaysian city. The same buses will return to Singapore with
Malaysian passengers in the evening.
The COVID19 pandemic in 2020 and 2021 closed land travel between Singapore and Malaysia.
This severely affected the business of Merlion. To cope with the downturn, they pivoted
towards local tour services. With both countries now moving towards the endemic phase of
COVID19 and opening up quarantine-free cross border travel. Merlion is now planning to

revert to its core business of luxury point-to-point services between the 2 countries.
Table 1. Daily Market Demand (passengers)
Malacca Kuala Lumpur Penang
200
350
120
0
0
0
0
0

From \ To Singapore
0
250
400
100

Singapore
Malacca
Kuala Lumpur
Penan

Table 1 shows the projected daily demand for its services at each city. For example, there are
some 350 daily customers who want to take its coach service from Singapore to Kuala Lumpur.
Similarly, there are some 400 daily customers who want to take its service from Kuala Lumpur
back to Singapore. There is no direct service between Malaysian cities
Table 2. Profit Per Passenger (S

Malacca Kuala Lumpur Penang
15
30
33
0
0

From \ To Singapore
0
15
30

Singapore
Malacca
Kuala Lumpur
Penang

Table 2 shows the profit per passenger per ride between Singapore and each Malaysian city
and vice versa. Merlion needs to plan how to deploy its fleet of buses to cover each route so
that it can maximise its profit.

Using the given information, demonstrate how you would apply the Linear Programming Technique to help Merlion plan its bus deployment.

1. Solve the LP model using the Excel Solver software and present your Answer and Sensitivity Reports in their original formats generated by Solver. Show, also, the underlying Excel matrix model used to run Solver. You may screenshot this part of your answer. State explicitly how the buses will be deployed and the maximum profit achievable.

(12 marks)

2. Determine what the profit per passenger has to be for buses to be deployed to Malacca. Explain how you derive your answer.

(4 marks)

3. How will Merlion’s profit be impacted if 2 buses were to break down on a given day. Explain your analysis.

(4 marks)