BUS 336 Lecture Notes - Lecture 10: Shadow Price

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 336
• Professor: Michael Favere- Marchesi

Document Summary

Make 0 units of product a and 60 units of product b for a max profit of. Finishing constraint all 120 hours used up. Non-negativity for product a: interpret the slack and/or surplus in each constraint. Shipping = 40 more units of product a can be shipped: use graphical analysis only to determine what range of values can the objective. Function coefficient (ofc) for x1 can assume without changing the optimal solution of (0, 60). Do the same for the odc for x2. Check to see if your solution is correct by checking the appropriate information on the solver output. Currently, the slope of the objective function is -5/35 = -0. 14285. From our graph, if the ofc for x1 was 17. 5, then the isoprofit line would be parallel to finishing constraint (i. e. , a slope of -0. 5) and (0,60) would still be in the optimal solution.