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

Metholodolgy, metholodolgy of operational research

metholodolgy of operational research

Job sequencing problem, on which basis we take value in time out time in co...

on which basis we take value in time out time in column?

Linear programming , the application areas of linear programming

the application areas of linear programming

Models, what is similation model as a type of mathematical models

what is similation model as a type of mathematical models

Process, process of operation research

process of operation research

Liner proggraming , A paper mill products two grade of paper viz., X & Y. B...

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

Demerits of range - measure of dispersion , Demerits  of Range a.It g...

Demerits  of Range a.It gives  importance  to the  two  extreme  values and is very much affected by the extreme items. b.The range  provides  no information  about the  st

Assigment , b. A paper mill produces two grades of paper viz., X and Y. Bec...

b. 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 pape

Ans, A paper mill produces two grades of paper viz., X and Y. Because of ra...

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 i

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