In the context of linear optimization problems, define reduced cost

What will be an ideal response?

The reduced cost tells how much the objective coefficient needs to be reduced in order for a nonnegative variable that is zero in the optimal solution to become positive. If a variable is positive in the optimal solution, as it is for both variables in this example, its reduced cost is always zero.

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If the interest rate on an FHA-insured mortgage loan is 5 1/2 percent and the monthly payment is $1,012 the principal sum would be

A) $22,080 B) $220,800 C) $184,000 D) $667,920

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A consumer who makes the purchase decision based on price is:

A) promotion prone B) brand loyal C) a repeat buyer D) price sensitive

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