Post-optimal analysis, Operation Research

Assignment Help:

It can be seen from the optimal solution for the foundry problem that two resources, raw material-1 and labor, are exhausted whereas the other two resources, raw material-2 and foundry capacity, remain available. This implies that the availability of raw material-1 and labor are both exerting a restrictive effect on foundry operation and its profitability. Let us suppose, the foundry can buy the raw material-1 in the open market at a cost of Rs.15 per kg, then is it worth buying and increasing its production to make more profit? Similarly, if the foundry can hire extra labor for Rs.15 per day, then is it worth hiring the extra labor?

The above questions can be answered from the (Zj - Cj) values in the final tableau. The (Zj - Cj) value corresponding to variables S1, that is, column 6 is 20. This indicates that the profit can be increased by Rs.20 for a unit increase in the availability of raw material-1. Thus, if one kilogram of raw material-1 costs Rs.15, then by purchasing it and changing the product mix, the foundry can increase its profit by Rs.20 - Rs.15 = Rs.5. Similarly, the (Zj - Cj) value corresponding to the variable SL is 10 and this indicates that for a unit increase in the availability of labor, profit can be increased by Rs.10. Hence, it is worth hiring labor if its cost is less than Rs.10. Similarly, it is worth buying raw material-1 from open market, if its cost is less than Rs.20 per kg.

The information in the final tableau is also useful in studying the effects of the variations in the profit contributions on the product mix.


Related Discussions:- Post-optimal analysis

A paper mill, A paper mill products two grade of paper viz., X & Y. Because...

A paper mill products two grade of paper viz., X & Y. Because of raw material restriction, it cannot produce more than 400 tons of grade X paper & 300 tons of grade Y paper in a we

Posson distribution - probability distribution , POSSON DISTRIBUTION ...

POSSON DISTRIBUTION   In binomial  distribution the value of n was  finite. But  there are few  problems  when  cannot  be estimated. So in these  binomial  distribution

Report writing - report writing presentation, REPORT WRITING The final...

REPORT WRITING The final step in research is to report the study  findings to those  who authorized the investigation. The American marketing association is  of the opinion  t

CHARACTERISTIC, O.R REPLACES MANAGEMENT BY PERSONALITY

O.R REPLACES MANAGEMENT BY PERSONALITY

Deviation taken from assumed mean, Deviation Taken from Assumed Mean ...

Deviation Taken from Assumed Mean This methods  is assorted  when the  arithmetic  average  is a  fractional value. Taking  deviation from  fractional value would  be a ver

Explain system control and security tools, 1. Explain the effects that MIS,...

1. Explain the effects that MIS, DSS, CRM and ERP have on organizational communication and decision making to increase productivity and efficiency in an increasingly competitive bu

Linear programmimg, #questionA paper mill produces two grades of paper viz....

#questionA paper mill produces two grades of paper viz., X and Y. Because of raw material restrictions, it cannot produce more than 400 tons of grade X paper and 300 tons of grad

Problems based on lpp when feasible region is unbounded, Problems based on ...

Problems based on LPP when feasible region is unbounded.     1.    Minimize z = 3x + 5y subject to constraints  X + y ≥ 2 X + 3y ≥ 3 X, y ≥ 0 script

endalk

7/4/2013 1:07:39 PM

what is post-optimality

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd