Investment Advisors, Inc., is a brokerage firm that manages stock portfolios for a number of clients. A particular portfolio consists ofUshares of U.S. Oil andHshares of Huber Steel. The annual return for U.S. Oil is $3 per share and the annual return for Huber Steel is $5 per share. U.S. Oil sells for $25 per share and Huber Steel sells for $50 per share. The portfolio has $80,000 to be invested. The portfolio risk index (0.50 per share of U.S. Oil and 0.25 per share for Huber Steel) has a maximum of 700. In addition, the portfolio is limited to a maximum of 1000 shares of U.S. Oil. The linear programming formulation that will maximize the total annual return of the portfolio is as follows:

Max 3U+5HMaximize total annual return

s.t.25U+50H80,000Funds available

0.50U+0.25H700Risk maximum

1U1000U.S. Oil maximum

U,H 0

Interpret each shadow price.

The shadow price is the value that the_______ will change by if you increase the constraint by one unit.

The funds available constraint has a shadow price of_________ which means that, if we add one dollar to the funds available, the value of the objective function would_______.

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Risk maximum has a shadow price of________ which means that, if we add one point to the risk index, the value of the objective function would _______.

US Oil has a shadow price of________which means that if we increase the number of shares allowed to be purchased by one then the value of the objective function would________

A constraint with a shadow price of 0 means that ________