Overview of Week 10

Reading Assignment:

Homework Assignment:

Vocabulary List:
 Section 6: Sensitivity Analysis
 What is the fundamental block matrix product that shows how
every simplex tableau can be obtained by multiplying the initial tableau
on the left by a nonsingular matrix?
 tableau approach to sensitivity analysis (block matrix structure)
 breakeven price
 reduced cost
 marginal values
 shadow prices
 objective coefficient range
 right hand side (or resource) range
 pricing out
 the fundamental theorem on sensitivity analysis

Key Concepts:
 Section 6:
 What is the fundamental block matrix product that shows how
every simplex tableau can be obtained by multiplying the initial tableau
on the left by a nonsingular matrix?
 tableau approach to sensitivity analysis (block matrix structure)
 breakeven price
 reduced cost
 marginal values
 shadow prices
 objective coefficient range
 right hand side (or resource) range
 pricing out
 the fundamental theorem on sensitivity analysis
Skills to Master:
 Apply the dual simplex algorithm
 computing breakeven prices
 computing ranges (cost coefficients and righthand sides)
 pricing out a new activity
 solving sensitivity analysis word problems
Quiz:
Friday, December 4.
 On this quiz the first question
will concern the theory and vocabulary words from Section 6.
The second question will ask you to do one or more of the following 3 things:
(1) compute the sensitivity ranges for either an objective coefficient or a righthand side,
(2) priceout a new activity, and/or
(3) answer a sensitivity analysis question using the tools we have developed in
class for this purpose.