1. The optimal solution to an optimization problem a. Always holds in the real w
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1. The optimal solution to an optimization problem a. Always holds in the real world b. Is not affected by the economic priorities c. Cannot be interpreted prior to application to the d. Can be modified by decision makers based on e. Is not based on simplification of the real world 2. Sensitivity analysis in a linear optimization problems can be performed real world problem economic priorities or other factors problem with respect to a. Objective function coefficients, but not constraint constants b. Constraint constants, but not objective function coefficients c. Both objective function coefficients and constraint constants d. None of the above e. Type of solver 3. Shadow price of a resource a. Is a value of a non-binding constraint b. Cannot be calculated using spreadsheets in Excel c. Is a difference in the values of the objective function due to a unit increase in a constraint. d. Always remains constant e. Has no economic interpretationExplanation / Answer
1. The optimal solution to an optimization problem can be modified by decision makers based on economic priorities.(Option D). As the optimal solution is one among the many solutions that satisfy the constraints, they can be subjected to change as per the real world priorities.
2. Sensitivity analysis in a linear optimization problem can be performed with respect to Both objective function coefficients and constraint coefficients. (Option C). As Sensitivity Analysis is finding out the correct amount via which changing the input data for some output for linear programming model so as to remain unchanged.
Thus, it can be related to changing both.
3. Shadow price of a resource is a difference in the values of the objective function due to a unit increase in a constraint. (Option C)
It is calculated by increasing the RHS of constraint by one and calculating the new objective function and subtracting it to find the shadow price.
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