A Shadow Price (Or Dual Value) Reflects Which of the Following

question 19

Multiple Choice

A shadow price (or dual value) reflects which of the following in a maximization problem?

• A) the marginal gain in the objective realized by subtracting one unit of a resource
• B) the market price that must be paid to obtain additional resources
• C) the increase in profit that would accompany one added unit of a scarce resource
• D) the reduction in cost that would accompany a one unit decrease in the resource
• E) the profit contribution necessary for that item to be included in the optimal solution

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Definitions:

Annual

Occurring once every year.

Absolute Value

The distance of a number from zero on the number line, without considering direction; always non-negative.

Solution

The number or collection of numbers that fulfill a given equation, inequality, or a set of equations.

Inequality

A mathematical statement that suggests a non-equivalence between two values or expressions.