Question: Sensitivity Report: Answer the following questions using the Sensitivity Report above: a) Please indicate the calculations necessary to arrive at a Reduced Cost of 0


Sensitivity Report: Answer the following questions using the Sensitivity Report above: a) Please indicate the calculations necessary to arrive at a Reduced Cost of 0 for the variable Units to produce of Whole product (Show your calculations). ( 0.5 points). b) If the profit per unit for the Roasted nut product increased from $1.40 to $1.60:1 ) would it be optimal to produce more units of Roasted nuts? 2) How would this change in profit per unit affect the optimal values of the decision variables and the objective function value (i.e., Total profit)? (Explain your answer and show your calculations). ( 0.5 points). c) What will happen to the optimal objective function value if the company decides to increase their chocolate available for production by 200 pounds? (Show your calculations). (0.5 points) d) The company has identified a new potential supplier for the additional 200 pounds of chocolate in part c. How much extra should the company be willing to pay for each pound of chocolate? Should they be willing to pay an additional $0.40 /pound? What about $0.80 ? (Explain your answer). (0.25 points). e) What would happen to the optimal objective function value (Total Profit) if the company does not receive a scheduled arrival of macadamia nuts and now the company only has 1,000 pounds for production? (Show your calculations). ( 0.5 points). f) Why is the Shadow Price for the Hulling, Roasting, and Coating machine time constraints equal to zero? (Explain your answer). ( 0.25 points). Sensitivity Report: Answer the following questions using the Sensitivity Report above: a) Please indicate the calculations necessary to arrive at a Reduced Cost of 0 for the variable Units to produce of Whole product (Show your calculations). ( 0.5 points). b) If the profit per unit for the Roasted nut product increased from $1.40 to $1.60:1 ) would it be optimal to produce more units of Roasted nuts? 2) How would this change in profit per unit affect the optimal values of the decision variables and the objective function value (i.e., Total profit)? (Explain your answer and show your calculations). ( 0.5 points). c) What will happen to the optimal objective function value if the company decides to increase their chocolate available for production by 200 pounds? (Show your calculations). (0.5 points) d) The company has identified a new potential supplier for the additional 200 pounds of chocolate in part c. How much extra should the company be willing to pay for each pound of chocolate? Should they be willing to pay an additional $0.40 /pound? What about $0.80 ? (Explain your answer). (0.25 points). e) What would happen to the optimal objective function value (Total Profit) if the company does not receive a scheduled arrival of macadamia nuts and now the company only has 1,000 pounds for production? (Show your calculations). ( 0.5 points). f) Why is the Shadow Price for the Hulling, Roasting, and Coating machine time constraints equal to zero? (Explain your answer). ( 0.25 points)
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