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

Evolution, how did operation research evolve

how did operation research evolve

Graphs of time series, Graphs of Time Series A time  series  is a sequ...

Graphs of Time Series A time  series  is a sequence of values  corresponding  to successive points  of time. Time  series  are  graphed  with time  on the x axis  and the  oth

Data and information, Data and Information: The term "data" (plural fo...

Data and Information: The term "data" (plural form of datum) refers to "an individual fact, statistic, or a piece of information or a group or a body of facts, statistics or t

Degree of correlation ship - correlation regression analysi, Degree of  Co...

Degree of  Correlation ship 1. Perfect Correlation: When  changes  in  two related variables are  exactly  proportional  there is  perfect correlation between  them. In case

Manufacturing operation , You are a manager at a medium sized manufacturing...

You are a manager at a medium sized manufacturing operation that sells a customized product directly to the consumers and the data pattern is linear but it can have the occasion ra

Linear programming, A paper mill produces two grades of paper viz., X and Y...

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

Objectives of measuring dispersion - measure of dispersion, Objectives of M...

Objectives of Measuring Dispersion a. To judge the Reliability  of Measures of Central Tendency: Measure of dispersion  is the  only means  to test the  representative charac

LPP, 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

Case Analysis, Ask question #Minimum 100 woRead this article and then write...

Ask question #Minimum 100 woRead this article and then write a three-page summary of the application (problem definition, objective function constraints, decision variables, etc.)

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