Exercise on Sensitivity Analysis

In the Blue Ridge Hot Tubs example, the LP problem was formulated as follows:

MAX: 350X1 + 300X2 } profit

S.T.: 1X1 + 1X2 <= 200 } pumps
9X1 + 6X2 <= 1566 } labor
12X1 + 16X2 <= 2880 } tubing
X1, X2 >= 0 } nonnegativity

Please answer the following questions based on the sensitivity report. Verify the solution using
Fig. 4_4.
Adjustable Cells
Final Reduced Objective Allowable Allowable
Cell Name Value Cost Coefficient Increase Decrease
$B$5 Number to make Aqua-Spas (X1) 122 0 350 100 50
Number to make Hydro-Luxes
$C$5 (X2) 78 0 300 50 66.66667
Constraints
Final Shadow Constraint Allowable Allowable
Cell Name Value Price R.H. Side Increase Decrease
$D$9 Pumps Req'd Used 200 200 200 7 26
$D$1
0 Labor Req'd Used 1566 17 1566 234 126
$D$11 Tubing Req'd Used 2712 0 2880 1E+30 168

Changes in the objective function coefficient:

1. What is the maximum value the objective function coefficient on X1 can assume without
changing the optimal solution? ANS: 350+100=450

2. What is the minimum value the objective function coefficient on X1 can assume without
changing the optimal solution? ANS: 350-50=300

3. How much can the objective function coefficient on X1 decrease before changing the optimal
solution? ANS: Maximum decrease in C1=50

4. What is the optimal objective function value if the objective function coefficient on X2 changes
to 250?
ANS: Change in C2=250-300=-50 is within the allowable range of change [-66.7, 50], the
solution remains optimal. The new optimal objective function value=350*122+250*78=62,200.

5. Will the optimal solution change if the objective function coefficient on X1 changes to 330 and
the objective function coefficient for X2 changes to 310?
ANS: r1=(330-350)/(-50)=0.4 r2=(310-300)/50=0.2
Since X1 and X2 has reduced costs of zero and r1+r2=0.6<1, the optimal solution remains
unchanged.

6. Will the optimal solution change if the objective function coefficients for X1 and X2 both
increases by 10? What is the new optimal objective function value?
ANS: r1=(10)/(100)=0.1 r2=(10)/50=0.2
Since X1 and X2 has reduced costs of zero and r1+r2=0.3<1, the optimal solution remains
unchanged.
The new optimal objective function value=360*122+310*78=68,100.

1
Changes in the RHS value of a constraint
7. What is the optimal objective function value if the RHS value of the first constraint decreases to
180?
ANS: 180-200=-20 is within the allowable range of change [-26, 7], the shadow price of the 200
holds. The optimal objective function value=66100+(-20)*200=62,100.

8. Can you determine the optimal objective function value if the RHS value of the first constraint
changes to 210? If not, re-solve the new model.
ANS: 210-200=10 is outside the allowable range of change [-26, 7], the shadow price of the 200
will no longer be valid. It is difficult to determine the optimal objective function value without
resolving the model. After resolving the model, the optimal solution is X1=108 and X2=99 and
the optimal objective function value=350*108+300*99=67,500.

Final Reduced Objective Allowable Allowable

Cell Name Value Cost Coefficient Increase Decrease
$B$5 Number to make Aqua-Spas (X1) 108 0 350 100 125
$C$5 Number to make Hydro-Luxes (x2) 99 0 300 166.6666667 66.66666667

Final Shadow Constraint Allowable Allowable

Cell Name Value Price R.H. Side Increase Decrease
$D$9 Pumps Req'd Used 207 0 210 1E+30 3
$D$10 Labor Req'd Used 1566 28 1566 54 486
$D$11 Tubing Req'd Used 2880 8 2880 72 792

9. What is the optimal objective function value if the RHS value of the third constraint decreases
by 100?
ANS: -100 [-168, + ), the shadow price of 0 is valid for the third constraint. The optimal
objective function value=66,100+0*(-100)=66,100.

Changes in the constraint coefficient

10. Will the solution remain optimal if the coefficient for X2 in the second constraint changes to 8?
ANS: Assuming that the shadow prices are valid, the reduced cost for X2=300-
(1*200+8*17+16*0)=-36. In order to maximize the objective function value, X2 needs to be set
to X2=0 in the optimal solution. Clearly, the original optimal solution will be changed.
Final Reduced Objective Allowable Allowable
Cell Name Value Cost Coefficient Increase Decrease
$B$5 Number to make Aqua-Spas (X1) 174 0 350 1E+30 12.5
$C$5 Number to make Hydro-Luxes (X2) 0 -11 300 11.11111111 1E+30
Final Shadow Constraint Allowable Allowable
Cell Name Value Price R.H. Side Increase Decrease
$D$9 Pumps Req'd Used 174 0 200 1E+30 26
$D$10 Labor Req'd Used 1566 39 1566 234 1566
$D$11 Tubing Req'd Used 2088 0 2880 1E+30 792

11. Will the solution remain optimal if the coefficient for X2 in the third constraint changes to 10?
ANS: Assuming that the shadow prices are valid, the reduced cost for X2=300-
(1*200+6*16.7+10*0)=0. Clearly, any increase of X2 does not increase the objective function
value. This implies the current solution remains optimal.