DISCUSSION REPLY

DISCUSSION REPLY. JUST NEED A RESPONSE TO THE DISCUSSION QUESTION BELOW. NO APA FORMAT, JUST WRITTEN IN A PARAGRAPH. NO SPECIFIC WORD COUBNT FOR RESPONSE.

Sensitivity Analysis is the study of how a change in a coefficient of the objective function affect the optimal solution. How does a change in the right-hand-side value for a constraint affect the optimal solution.

Let’s say you work on the problem below and determine that the optimal solution is $360.000.00 profit contribution by selling 400 pounds of BB (basic banana) and 600 pounds of TP (top banana). Your first constraint was defined as 1BB + 1TP ≤ 1000. You also look at the Excel report and see terms such as “Binding, Not Binding, Allowable Increase, Allowable Decrease, Slack, Shadow Price and so on.

In your own words, what does all that mean? Otherwise, we can just read the definition in the book.

Now, the most important is to determine what do you think would happen if we decrease 1000 to 800 for example? What about you increase from 1000 to 1200? When do you determine that a new LP is needed? Also, what does happen graphically with the constraints that you have previously determined and pointed out the optimal solution?

The answer for these questions is what we call Sensitivity Analysis; the WHAT IF that you might be presented by your manager for example and should know the answers.

Once reading the chapter, can you tell me what you understand by the terms presented (not book definitions)? And more importantly, can you give me specific examples?

DISCUSSION REPLY

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