Solution to Lecture 10 in-class exercises

Burn-off Drink
1. Reduced cost of A is 0 because this is a basic decision variable.
Final value of B is 0 because its associated reduced cost is non-zero.
Allowable increase of B is infinity and allowable decrease is 5.6875.
Reduced costs for C and D are both 0’s because they are basic.
Final value of Daily req LHS is 36 because this is a binding constraint.
Final value of Chemical X is 280 because this is a binding constraint.
Shadow price of Chemical Y is 0 because this is a nonbinding constraint. Allowable
increase of Y is 5.75 and allowable decrease is infinity.
2. New constraint B > 1, cannot be satisfied by the current optimal solution, must re-
solve.
3. As long as the price of C is within the range of 6-2.33 = 3.67 and 6+15 = 21 cents, the
current optimal solution remains optimal. It is not so sensitive.
4. Simultaneous change re two constraints. As 5/11 + 50/346 < 100%, both shadow
prices are valid. + OFV = 0.875*(-5) + (-0.2375)*(-50) = 7.5. Therefore, both
changes together will cause the cost to go up by 7.5 cents. No, it is not cost-effective.
5. Decrease by 10, but the allowable decrease is infinity, within the range. As this is a
non-binding constraint, both optimal solution and OFV remain unchanged.
6. Increase of a RHS by 250, which is outside the allowable increase of 47.14, must re-
solve.
7. Increase of Chemical X RHS by 70, which is outside the allowable increase of 41,
must re-solve.
8. Increase of Chemical Y RHS by 5, is within the allowable increase limit of 5.75. As
this is a non-binding constraint, both optimal solution and OFV remain the same.
9. Adding a new constraint, A > 2B, current optimal solution satisfies this constraint,
both optimal solution and OFV remain the same.
10. Adding a new constraint, A < 3B, current optimal solution doesn’t satisfy this
constraint, must re-solve.
11. Introducing a new decision variable, must re-formulate and re-solve.