LP

The following questions are all related to the example problems discussed in the notes and in the lectures. Answer these questions through basic optimization concepts, modeling changes and/or through duality/sensitivity analysis concepts. Regarding the questions on optimal solution optimal value changes, just state whether a change is expected or not and the direction of the change if it is expected. Treat each question independently and assume all other conditions in the related problems remain the same (other than the stated changes). I. The Currency Exchange Planning Problem 1. How would the L.P. model related to this problem, the optimal solution and the optimal value be effected, after the following alterations additions? Regarding possible changes in the optimal solution and/or the optimal value, just state whether a change is expected or not, and the direction of the change if it is expected. i) An additional 0.5 % commission (or tax) being imposed on all currency exchange transactions? (For example, while originally 13.135 Peso were received in exchange for S 1, now 13.135 x 0.995 = 13.069 Peso would be received: equivalently, while s 0.07586 were received in exchange for 1 Peso, now 0.07586 x 0.995 - $ 0.07548 would be received) ii) As a measure against currency exchange risks, the company would like to follow a poliy of having its cash stocks in any currency not exceeding 40% of its total cash stocks, at end of any day. The following questions are all related to the example problems discussed in the notes and in the lectures. Answer these questions through basic optimization concepts, modeling changes and/or through duality/sensitivity analysis concepts. Regarding the questions on optimal solution optimal value changes, just state whether a change is expected or not and the direction of the change if it is expected. Treat each question independently and assume all other conditions in the related problems remain the same (other than the stated changes). I. The Currency Exchange Planning Problem 1. How would the L.P. model related to this problem, the optimal solution and the optimal value be effected, after the following alterations additions? Regarding possible changes in the optimal solution and/or the optimal value, just state whether a change is expected or not, and the direction of the change if it is expected. i) An additional 0.5 % commission (or tax) being imposed on all currency exchange transactions? (For example, while originally 13.135 Peso were received in exchange for S 1, now 13.135 x 0.995 = 13.069 Peso would be received: equivalently, while s 0.07586 were received in exchange for 1 Peso, now 0.07586 x 0.995 - $ 0.07548 would be received) ii) As a measure against currency exchange risks, the company would like to follow a poliy of having its cash stocks in any currency not exceeding 40% of its total cash stocks, at end of any day