Now lets focus on to sensitivity analysis. In sensitivity analysis, we see how sensitive the optimal solution to the changes in data values. Derive the optimal solution to the below question using graphical method. (15%) max 51 + 72 1 6 ; 21 + 32 19 ; 1 + 2 8 ; 1, 2 0

1. Assuming the coefficient of 1 and 2 in the objective functions are c1 and c2 respectively, find the value ranges of c1 and c2 where current optimal solution would not change. (10%)

2. Explain the terms shadow price and binding constraints. (5%)

3. Calculate the shadow prices for the three constraints. (10%)

4. Calculate the range of applicability for the above calculated shadow prices. (10%)