BUSOBA 2321 Final Exam

BUSOBA 2321 Final Exam
What question are we trying to answer when performing sensitivity analysis?
How sensitive is our solution to changes in the assumptions that we made?
T or F: The optimal solution will not always be at a corner point
False - it always will be since this is where two constraints are maxed out - more
resources = more production = more optimal
T or F: The assumptions made in our linear program formulation (i.e. how much profit
we will be able to make per unit of a particular product) may change based on market
conditions - which we do not have control over.
True
Define shadow price
The change in the OBJ FN value if we increase one constraint by one unit.
By solving for the shadow price of a constrained resource, what question are we
answering?
If we have a additional unit of the constrained resource available, how much could our
OBJ FN value increase by?
How do we know if the addition of a constraing will result in the OBJ FN value
increases, staying the same, or decreasing?
An additional constraint will never increase the OBJ FN VAL.
If the constraint is redundant (i.e. it is already being adhered too; there is another
constraint that is more restrictive than this new constraint), our OBJ FN val wiull remain
the same - the feasible region will not change.
If it is not redundant (is not already being adhered to - the addition of this constraint
decreases our feasible region), our OBJ FN val will decrease
What are the two sections of a sensitivity report?
1. adjustable cells
2. constraints
For what type of constraint (what sign) might slack exist?
maximums;
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For what type of constraint (what sign) might surplus exist?
Minimums