BUSMGT 2321 Lecture Notes - Lecture 5: Total S.A.
26 Mar 2018
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2-variable system - problem, or equatino with 2 variables. Multi-variable system - problem with more than 2 variables, can have any # of constraints & variables. Systems become more complex -> more difficult to solve, when more variables and constraints are added. 2 var. w/ 2 equations: solve easily by hand. 3+ var. w/ 3+ equations: more difficult, want to use computers. What am i max or min? (what is our objective) What are our decision variables [dv]? (what do we have control of) i. What are the constraints? (& how many) i. ii. iii. To max w/o constraints or risk, invest all in pacific oil. Max: (7. 3%x1 + 10. 3%x2 + 6. 4%x3 + 7. 5%x4 + 4. 5%x5) Max: . 073x1 + . 0103x2 + . 064x3 + . 075x4 + . 045x5 i. Total value of investment after year: add 1 to the coefficents. Max: roi . 073x1 + . 0103x2 + . 064x3 + . 075x4 + . 045x5. Neither industry (oil or steel) receive more than 50,000.
