A shadow price reflects which of the following in a maximization problem?
A)The marginal cost of adding additional resources
B)The marginal gain in the objective that would be realized by adding one unit of a resource
C)The net gain in the objective that would be realized by adding one unit of a resource
D)The marginal gain in the objective that would be realized by subtracting one unit of a resource
E)Assessing the impact of potential changes of the parameters (numerical values)of an LP model on its optimal solution.

Question

Quizplus · Accepted Answer

A shadow price reflects the marginal gain in the objective that would be realized by adding one unit of a resource. It tells us how much the objective function will increase (in a maximization problem) or decrease (in a minimization problem) by adding one unit of a particular resource.

A Shadow Price Reflects Which of the Following in a Maximization