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Sensitivity Analysis

This document discusses sensitivity analysis for an optimization problem involving maximizing profit from publishing restaurant guides (x1) and real estate guides (x2). It finds that maximum profit of $11,500 occurs when x1 = 8,000 and x2 = 10,000. The sensitivity range for x2 is found to be up to 0.7353, and slack in the printing budget constraint is $140. Increasing the rack space constraint leads to higher optimal profits, while reducing x1 leads to a $250 decrease in optimal profit.

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56 views14 pages

Sensitivity Analysis

This document discusses sensitivity analysis for an optimization problem involving maximizing profit from publishing restaurant guides (x1) and real estate guides (x2). It finds that maximum profit of $11,500 occurs when x1 = 8,000 and x2 = 10,000. The sensitivity range for x2 is found to be up to 0.7353, and slack in the printing budget constraint is $140. Increasing the rack space constraint leads to higher optimal profits, while reducing x1 leads to a $250 decrease in optimal profit.

Uploaded by

aditya_kapre
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Sensitivity Analysis.

ISLAND PUBLISHING COMPANY.

SUM NO. 35, 36 & 37


PAGE NO: 120-121

Aditya Rajesh Kapre


PGP10
Roll No. 20101001
Q.35

Variables:
x1 – no. of restaurant and entertainment guides
x2 - no. of real estate guides

x1 x2
Profit 0.5 0.75 <----- Maximize
Constraints
1 0.17 0.25 <= 4000
2 1 1 <= 18000
3 1 0 >= 8000
4 0 1 >= 8000
Q.35

Solving the given objective function, we get-


Q.35

The maximum profit is obtained for-

x1 = 8000 units

x2 = 10000 units
Z= $ 11500
For given constraints.
Q. 36 (a)

We have to find the sensitivity range for the advertising


revenue generated by the real estate guide(x2).
 The terms to be considered here are-
1. 0.5 x1 + 0.75 x2 (slope of this term)
2. 0.17 x1 + 0.25 x2 <= 4000

 Now for the sensitivity analysis, we’ve to make the slope of the
objective function equal to the slope of one of the constraints.
 Thus, the objective function line becomes exactly parallel to
the constraint line.
Q.36 (a)

Now here we have to find the sensitivity analysis


only for one range i.e. for real estate guide.
The slope of the objective function is -0.5/0.75.
Now considering c2 as the objective function
coefficient for real estate guide (x2).
-0.5 = -0.17
c2 0.25

i.e. c2 = 0.7353
Q.36 (a)

This means that the coefficient of x2 is 0.7353, then


the objective function will have a slope of
-0.5/0.7353 or -0.17/0.25.
Thus, we have determined the upper limit of the
sensitivity range for c2, the x2 coefficient, is 0.7353.
 Hence,
c2 <= 0.7353
i.e. the value of coefficient of x2 can be varied upto 0.7353
while getting the same optimal solution.
Q. 36 (b)

Now using these values, we can find the slack in the


printing budget.
The constraint representing the same is-
0.17 x1 + 0.25 x2 <=4000
i.e. 0.17 x1 + 0.25 x2 + s1 =4000

 Using the values of x1 and x2 , we get the slack ‘s1’ in the


printing budget of $140.
Q.36 (c)

Now, changing the constraint


x2 >= 12000
Keeping all other constraints as they are, we get the graph :-
Q. 36 (c)

We can see that for the change in constraint, we have


no feasible solution.
Hence, the company should not accept this offer.
Q.37 (a)

If the rack space is increased to 18500, we get a


change in constraint as:
x1 + x2 <= 18500
 For this, we get the solution-
Q.37 (a)

The solution obtained here is-


x1 = 8000 & x2 = 10500
and Z = $ 11875

 Similarly, if the rack space is increased for 20000, the


solution obtained is-
x1 = 8000 & x2 = 12000
and Z = $ 11920
Q.37 (b)

If the company reduces its distribution of


entertainment guide from 8000 to 7000, the net
profit would be-
Z = $ 11750
This value is still more than for the initial constraint.
The net increase in the worth would be-
ΔZ = 11750 – 11500
i.e. ΔZ = $ 250.
Thank You

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