Linear programming, Financial Management

Assignment Help:

Linear programming, one of the important techniques of operations research, has been applied to a wide range of business problems. This technique is useful in solving decision making problems which involve maximizing a linear objective function subject to a set of linear constraints.

Linear programming is helpful in solving a variety of problems in finance, budgeting and investments. The important applications of this technique are in the following areas:

  • Selection of a product mix which maximizes the profits of the firm subject to several production, material, marketing, personnel and financial constraints.

  • Determination of the capital budget which maximizes the net present value of the firm subject to several financial, managerial, environmental, and other constraints.

  • Choice of mixing short-term financing which minimizes the cost subject to certain funding constraints.

This note, expounding the basis of linear programming is divided into four sections including this introductory section. Section II presents the graphical method of solving the linear programming problem. Though this method can be applied only to those problems having only two basic variables, it is a very useful pedagogic device to understand certain concepts underlying the more advanced methods of linear programming. 


Related Discussions:- Linear programming

University , After read all the available information carefully, prepare a ...

After read all the available information carefully, prepare a two page (double-spaced) essay and answer the following questions: Assume that we have the following data: C=100+0.50Y

Illustrate report on cash flow budget, Q. Illustrate report on cash flow bu...

Q. Illustrate report on cash flow budget? The cash flows The principal reason why certain statistics were not included in the cash flows is that they are incremental cash

Future value of an annuity, Will you please give the defination of "Future ...

Will you please give the defination of "Future Value Of An Annuity"?

Rectification of errors, What is rectification of errors? List and explain ...

What is rectification of errors? List and explain the stages where the errors are deducted for rectification.

State the term - redemption, State the term - Redemption Redemption is ...

State the term - Redemption Redemption is repayment of debt security at or before maturity.  Redemption could at par or at a premium to face value. A debt security will be rede

Criticize the flexible exchange rate regime, Criticize the flexible exchang...

Criticize the flexible exchange rate regime from the viewpoint of the proponents of the fixed exchange rate regime. If exchange rates are fluctuating very frequently, that may

Credit spreads and the valuation of non-treasury securities, It is not easy...

It is not easy to determine the theoretical value of non-treasury securities. However, we can use the treasury spot rate for the valuation of non-treasury security.

What is unsanctioned expenditure, Q. What is Unsanctioned Expenditure? ...

Q. What is Unsanctioned Expenditure? The expenditure, which is regularly incurred without the sanction of the competent authority or beyond the sanctioned limit of funds provid

State the term nature of financial instruments, State the term nature of fi...

State the term nature of financial instruments. Nature of financial instruments (securities): Financial instruments (termed as securities) can be classifies in two broad

Blue sky, Blue Sky It refers to laws that safeguard investors from bei...

Blue Sky It refers to laws that safeguard investors from being misled by investment people who misrepresent the significance value of investments to get the money of the finan

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd