In a production application involving a fixed setup cost and a variable cost, the use of __________ makes including the setup cost possible in a production model.
A)location variables
B)noninteger constraints
C)objective function coefficients
D)binary variables

Question

Quizplus · Accepted Answer

Binary variables can be used to represent whether or not the setup cost is incurred for a particular time period or production batch. By multiplying the binary variable with the setup cost coefficient and adding it to the objective function, the setup cost can be included in the model.

In a Production Application Involving a Fixed Setup Cost and a Variable