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

One tailed and two tailed tests -hypothesis testing , Normal 0 ...

Normal 0 false false false EN-IN X-NONE X-NONE

Linear programming, Ask question #Minimum 100 words acceptNas food produces...

Ask question #Minimum 100 words acceptNas food produces to kinds of popular dark chocolate bars. the banana and coffee. the banana bar costs 0.22 to make and sells of 0.35, where a

Assignment, discuss about assignment and steps involved in it

discuss about assignment and steps involved in it

Goal programming, Goal Programming This provides a more realistic model...

Goal Programming This provides a more realistic model. In a modern setting, profit maximization may not be the only objective of a business concern. Other objectives or goals c

Advantages of mode - measure of central tendency, Advantages of Mode ...

Advantages of Mode a.It is easy to understand  as well as easy  to calculate. In  can be found out by  inspection. b.It is  usually an exacta value  as it  occurs most fre

Graphic , max z 60x1+50x2 Sab to 4x1+10x2 2x1+2x2 3x...

max z 60x1+50x2 Sab to 4x1+10x2 2x1+2x2 3x1+2x2 X1+x2. >_ o

Students t distribution - hypothesis testing, Normal 0 false ...

Normal 0 false false false EN-IN X-NONE X-NONE

Purchasing, need of detailed information about the topic

need of detailed information about the topic

Histogram and historigram, #qudistinguish between histogram and historigram...

#qudistinguish between histogram and historigram estion..

Solve by simplex method, Solve by simplex method Maximize Z = 5...

Solve by simplex method Maximize Z = 5x 1 + 3x 2 Subject to 3x 1 + 5x 2 ≤ 15 5x 1 + 2x 2 ≤ 10 &         x 1 ≥ 0, x 2  ≥ 0 [Ans. Max Z = 235/19

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