Assume That the Shadow Price of a Non-Binding "≤" Constraint

question 23

Multiple Choice

Assume that the shadow price of a non-binding "≤" constraint is 5.This implies that:

• A)if the right-hand side value of the constraint increases by 1 unit,the objective function value will increase by 5 units
• B)if the right-hand side value of the constraint increases by 1 unit,the objective function value will decrease by 5 units
• C)if the right-hand side value of the constraint increases by 1 unit,the objective function value will remain unchanged
• D)if the right-hand side value of the constraint decreases by 1 unit,the objective function value will increase by 5 units
• E)if the objective function coefficient increases by 1 unit,the shadow price will increase by 5 units

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Definitions:

Valid Acceptance

An agreement to the terms of an offer in a manner required by the contract, resulting in a binding contract between the parties.

Communicated

Communication involves the act of sharing, exchanging, or transmitting information, ideas, or feelings between individuals or entities, through various means.

Offeree

The person to whom an offer is made, typically in the context of contract formation.

Rejection

Rejection refers to the act of refusing to accept, submit to, believe, or make use of something.