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Fixed cost oriented bottleneck analysis with linear programming

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  • Koltai, T.

Abstract

Despite the increasing ratio of fixed cost in the operating cost of production systems, variable cost oriented decision support methods prevail. These methods, however, have several unexploited capabilities to consider period costs as well. This paper shows how sensitivity analysis of the optimum solution of a linear programming model can provide overhead oriented information as well. The analysis is illustrated with a simple example.

Suggested Citation

  • Koltai, T., 1995. "Fixed cost oriented bottleneck analysis with linear programming," Omega, Elsevier, vol. 23(1), pages 89-95, February.
    • Handle: RePEc:eee:jomega:v:23:y:1995:i:1:p:89-95
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    References listed on IDEAS

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    1. John L. Harpell & Michael S. Lane & Ali H. Mansour, 1989. "Operations Research in Practice: A Longitudinal Study," Interfaces, INFORMS, vol. 19(3), pages 65-74, June.
    2. Farkas, Andras & Koltai, Tamas & Szendrovits, Andrew, 1993. "Linear programming optimization of a network for an aluminum plant: A case study," International Journal of Production Economics, Elsevier, vol. 32(2), pages 155-168, September.
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    1. Koltai, Tamas & Terlaky, Tamas, 2000. "The difference between the managerial and mathematical interpretation of sensitivity analysis results in linear programming," International Journal of Production Economics, Elsevier, vol. 65(3), pages 257-274, May.

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