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Final Exam Study Guide

Final Exam Study Guide - Final Exam Study Guide Chapter 1...

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Final Exam Study Guide Chapter 1: Steps of management science: 1)observation 2) problem definition 3) model construction 4)solution 5)implementation Break even analysis or profit analysis: v= fixed costs/(price-variable cost) An increase in fixed costs will increase break-even point An increase in variable costs will decrease the break-even point An increase in price lowers the breakeven point Parameters are the numbers in the z equation Chapter 2: Steps of LP model formulation: 1) define decision variables 2) objective function 3) constraints To solve for the optimal extreme point set both constraints equal to x1, then set them equal and solve for x2, take your x2 value and plug it into either of the constraints to solve for x1. Then take your x1 and x2 and plug into z= you will get answer Slack variables represent unused resources You add the +s1 to the first constraint and +s2 to the second plug in the values for x1 and x2 and you get your slack. A surplus variable is subtracted from a >= constraint to convert it to = If 2 lines have the same slope multiple optimal solutions occur. Infeasible problems are usually a result of errors in defining the problem or in formulating the programming model. Components of a linear programming model are: 1)objective function 2)decision variables 3) constraints Linear programming models are proportional, additive, divisible, and certainty Chapter 3: Sensitivity range is range of values over which the current optimal solution will remain optimal. Represented as allowable increase and decrease in top of sensitivity reports (add to obj coefficient or subtract).
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