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

35mm slider -report writing presentation , 35mm Slider  35 mm Slider l...

35mm Slider  35 mm Slider like OHP transparencies casts  an images but they  have different  uses and  properties. They are used  to show an actual photographic  images in the

Application of the chi square test - hypothesis testing, Application of the...

Application of the chi Square Test   The  chi square distribution  has a number of applications are given  below: a.Chi Square test of goodness of fit. b.Chi square te

Considerations for oral reporting, Considerations for Oral Reporting S...

Considerations for Oral Reporting Sometimes  the researcher has been asked to  make an oral presentation of his  research findings he should  bear in mind a few major  conside

''qualitative generic research'', Use the following article on qualitative ...

Use the following article on qualitative approaches written by Kahlke (2014), http://ejournals.library.ualberta.ca/index.php/IJQM/article/viewFile/19590/16141/ to answer the fol

data analysis and research methodology , Case  Study - Data Analysis ...

Case  Study - Data Analysis Sandarsen  inc was testing new  packaging  and a few  recipe  for a family  desert cookie  that had  been  on the  market for several years. It wa

Modeling, Model building is the essence of the operations research approach...

Model building is the essence of the operations research approach? Discuss.

Linear Programming , A Paper mill produces two grades of paper viz. X and ...

A 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 grade Y paper in

Liner, #question.A paper mill produces two grades of paper viz., X and Y. B...

#question.A 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 grade

Pamphlets and Patents - classification of documents, Pamphlets - classifica...

Pamphlets - classification of documents: A pamphlet is an independent publication. It is normally a document of a few printed pages, usually less than 49. Pamphlets cover an e

Non measurable human factors, Operation research makes no allowance for in...

Operation research makes no allowance for intangible factors such as skill attitude vigor of the management people in taking decisions but in many instances success or fail

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