The Dual Price Associated with a Constraint Is the Change

question 40

True/False

The dual price associated with a constraint is the change in the value of the solution per unit decrease in the right-hand side of the constraint.

---

Definitions:

Call Features

Provisions embedded in financial instruments, like bonds, that allow the issuer to repurchase or redeem the instrument before its maturity date.

Call Penalties

Fees or costs that a borrower must pay a lender for the privilege of paying a loan off earlier than the agreed payment schedule.

Call Premiums

The amount by which the price of a callable bond or preferred stock exceeds its par value or redemption price, often stipulated as a penalty for early redemption by the issuer.

Coupon Rates

Interest rates specified on bonds or other fixed-income securities that issuers promise to pay bondholders annually, expressed as a percentage of face value.