Provide an interpretation of all elements
The analytics gurus at Zevon realize that they had misformulated their demand curves. They now believe that demand for X1 is given by 1000 - 2.25p1, demand for X2 is given by 2000 - 3p2, and demand for X3 is given by 3000 - 3.5p3. This model is entered in Excel and the sensitivity report contains the following:
Constraints
Final Lagrange
Cell Name Value Multiplier
$F$8 Lawyers 5000.00 101.052
$F$9 Guns 9275.74 0
$F$10 Money 9213.49 0
Answer: The only resource that Zevon could use more of is lawyers; the final value is 5000, which exhausts their entire supply. If additional lawyers could be retained for less than $101.05, then Zevon should pursue this possibility. There is no information available as to the range for the validity of this $101.05. The guns resource has only 725 units remaining and the money resource has $5,800 left. When one of those two resources is exhausted, the lawyer Lagrange multiplier will likely not be valid.
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