1.Every statement of any problems is advised to be read carefully.
2.Identification of decision variables
With the help of these variables, the required decisions are to be made. An important decision that needs to be taken in this respect is identifying the variable set that will create a direct impact on the various levels of objective achievement. This decision will also include the control on this impact by a decision maker.
After the variables are pointed out, list them accordingly with the variable’s description.
For example,
X1= total number of units manufacturedand traded per week of product 1
X2= total number of units manufacturedand traded per week of product 2
- Constraint recognition
While allocating values to decision variables, which conditions should be fulfilled? A suggested version would be to write a constraint’s textual description and then it should be followed by its mathematical representation.
For example,
Total manufacture of product 1 > 200 units
4.Objective identification
A clear understanding of objective is required. How can a model’s objective be helpful in maximising and minimising various aspects of theproduction process?
For example,
Maximising the weekly profit from the production of commodity 1 and 2.
5.Figuring out the mathematical model
You may describe an objective function on a given restriction when you start with a problem. You should make aproper decision as per the requirement of the problem. Also, try to include non-negative restrictions.
Links of Previous Main Topic:-
- Concept of cost of capital
- Capitalization meaning
- Concepts of working capital
- Concept of capital expenditure
- Learning objectives and chapter outline
- Limitations of operations research
Links of Next Finance Topics:-
- Graphical solutions
- Linear programming learning objectives and outline of chapter
- Introduction learning objectives
- Duality in linear programming
