Business Jargons

Definition: The Vogel's Approximation Method or VAM is an iterative procedure calculated to find out the initial feasible solution of the transportation problem. Like Least cost Method, here also the shipping cost is taken into consideration, but in a relative sense. The following is the flow chart showing the steps involved in solving the transportation problem using the … [Read more...] about Vogel’s Approximation Method

Definition: The Least Cost Method is another method used to obtain the initial feasible solution for the transportation problem. Here, the allocation begins with the cell which has the minimum cost. The lower cost cells are chosen over the higher-cost cell with the objective to have the least cost of transportation. The Least Cost Method is considered to produce more optimal … [Read more...] about Least Cost Method

Definition: The North-West Corner Rule is a method adopted to compute the initial feasible solution of the transportation problem. The name North-west corner is given to this method because the basic variables are selected from the extreme left corner. The concept of North-West Corner can be well understood through a transportation problem given below: In the table, … [Read more...] about North-West Corner Rule

Definition: The Transportation Method of linear programming is applied to the problems related to the study of the efficient transportation routes i.e. how efficiently the product from different sources of production is transported to the different destinations, such as the total transportation cost is minimum. Here origin means the place where the product is originated or … [Read more...] about Transportation Method of Linear programming

Definition: The Duality in Linear Programming states that every linear programming problem has another linear programming problem related to it and thus can be derived from it. The original linear programming problem is called “Primal,” while the derived linear problem is called “Dual.” Before solving for the duality, the original linear programming problem is to be … [Read more...] about Duality in Linear Programming

Definition: The Simplex Method or Simplex Algorithm is used for calculating the optimal solution to the linear programming problem. In other words, the simplex algorithm is an iterative procedure carried systematically to determine the optimal solution from the set of feasible solutions. Firstly, to apply the simplex method, appropriate variables are introduced in the linear … [Read more...] about Simplex Method

Definition: The Linear Programming problem is formulated to determine the optimum solution by selecting the best alternative from the set of feasible alternatives available to the decision maker. Assumptions of Linear programming There are several assumptions on which the linear programming works, these are: Proportionality: The basic assumption underlying the … [Read more...] about Assumptions of Linear Programming

Definition: Linear programming is a technique for selecting the best alternative from the set of available alternatives, in situations in which the objective function and constraint function can be expressed in quantitative terms. Minimization Case: The minimization case can be well understood through a problem. Let’s say; the agricultural research institute recommended a … [Read more...] about Formulation of Linear Programming-Minimization Case

Definition: Linear programming refers to choosing the best alternative from the available alternatives, whose objective function and constraint function can be expressed as linear mathematical functions. Maximization Case: Let's understand the maximization case with the help of a problem. Suppose a firm produces two products A and B. For producing the each unit of product A, … [Read more...] about Formulation of Linear Programming-Maximization Case

Definition: The Linear Programming method is a technique of selecting the best alternative out of the available set of feasible alternatives, for which the objective function and the constraint function can be expressed as linear mathematical functions. There are certain prerequisites for applying the linear programming technique. These are: There should be an … [Read more...] about Linear Programming