Scribd
Upload
57 views5 pages

Linear Programming: Sensitivity Analysis: Management Science

This document discusses sensitivity analysis and what-if analysis for linear programming models. It provides guidance on how sensitivity analysis can help managers understand the impact of changing parameters and constraints. The key topics covered are the allowable range for objective function coefficients, the meaning and importance of shadow prices, and rules for using shadow prices to predict the effects of simultaneous changes to right-hand side constraints.

Uploaded by

鄧用良
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
57 views5 pages

Linear Programming: Sensitivity Analysis: Management Science

This document discusses sensitivity analysis and what-if analysis for linear programming models. It provides guidance on how sensitivity analysis can help managers understand the impact of changing parameters and constraints. The key topics covered are the allowable range for objective function coefficients, the meaning and importance of shadow prices, and rules for using shadow prices to predict the effects of simultaneous changes to right-hand side constraints.

Uploaded by

鄧用良
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 5

Management Science

Linear Programming:
Sensitivity Analysis

Dr. Jiun-Yu Yu
BA, NTU
31 Mar 2020

5.1

• For what kinds of managerial policy decisions does what-if


analysis provide guidance?

A. What-if analysis provides guidance about what the impact


would be of altering policy decisions that are represented by
parameters of a model.

31-Mar-2020 JY YU, BA, NTU 5–2

2
5.2

• Summary of Management’s What-If Questions !


1.
2.
3.
4.
5.

31-Mar-2020 JY YU, BA, NTU 5–3

5.3

• What is meant by the allowable range for a coefficient in the


objective function?

A. The allowable range for a coefficient in the objective


function is the range of values over which the optimal
solution for the original model remains optimal.

31-Mar-2020 JY YU, BA, NTU 5–4

4
5.4

• In this 100 percent rule, if the sum of the percentage changes


exceeds 100 percent, does this mean that the original optimal
solution is no longer optimal?

A. No, exceeding 100% may or may not change the optimal


solution depending on the directions of the changes in the
coefficients.

31-Mar-2020 JY YU, BA, NTU 5–5

5.5 (1)

• What is meant by a shadow price?

A. The shadow price for a constraint is the rate at which the


value of the objective function can be increased by increasing
the right-hand side of the constraint by a small amount.

31-Mar-2020 JY YU, BA, NTU 5–6

6
5.5 (2)

• Why are shadow prices of interest to managers?

A. The shadow price for a constraint informs management about


how much the total profit will increase for each extra unit of a
resource (right-hand-side of a constraint).

31-Mar-2020 JY YU, BA, NTU 5–7

5.5 (3)

• What does a shadow prices of 0 tell a manager?

A. A shadow price of 0 tells a manager that a small change in the


right-hand side of the constraint will not change the objective
function value at all.

31-Mar-2020 JY YU, BA, NTU 5–8

8
5.6 (1)

• What is the 100 percent rule for simultaneous changes in right-


hand sides?

A. The 100 percent rule says that we can safely use the shadow
prices to predict the effect of simultaneous changes in the
right-hand sides if the sum of the percentages of the changes
does not exceed 100 percent..

31-Mar-2020 JY YU, BA, NTU 5–9

5.6 (2)

• What is the conclusion if the sum of the percentages of


allowable changes in the right-hand sides does exceed 100
percent?

A. If the sum of the percentages of allowable changes in the


right-hand sides does exceed 100%, then we cannot be sure if
the shadow prices will still be valid.

31-Mar-2020 JY YU, BA, NTU 5 – 10

10

You might also like