The Optimal Combination of Decision Variables of a Linear Programming

question 18

Multiple Choice

The optimal combination of decision variables of a linear programming problem is x = 20 and y = 30.The given resource constraints are: 5x + 2y  150 and y  15.The shadow price of the second constraint is _____.

• A)1.5
• B)0.67
• C)Zero
• D)10
• E)0.1

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Definitions:

Marginal Revenue Curve

A graphical representation showing how marginal revenue varies with changes in quantity sold.

Kinked

Often relating to the kinked-demand curve seen in oligopolistic markets, where firms face a price elasticity that abruptly changes as prices increase or decrease.

Oligopolist

A seller in an oligopoly market, a market structure characterized by a small number of firms dominating the market.

Payoff Matrix

A table showing the potential outcomes or payoffs from different decisions or strategies in game theory.