8.1 Learning Outcomes:
Find some structured ways of dealing with complex managerial decision problems.
Explain simple decision models and management science ideas that provide powerful and (often
surprising) qualitative insight about large spectrum of managerial problems.
Demonstrate the tools for deciding when and which decision models to use for specific problems.
Build an understanding of the kind of problems that is tackled using spreadsheet modeling and decision
8.2 Action Required:
Read the following chapter of your Textbook.
Chapter 8: Non-Linear Optimization
8.3 Test your Knowledge (Question):
Explain the various types of constraints.
Describe the Portfolio Optimization Model.
Answer both questions in test your knowledge section.
THIS IS THE ANSWER FOR HELP U
1-• LT constraints (LHSGT constraints (LHS
-Commitments or thresholds
-EQ constraints (LHS=RHS)
-Define related variables consistently
2- The performance of a portfolio of stocks is measured in terms
of return and risk.
When we create a portfolio of stocks, our goals are usually to
maximize the mean return and to minimize the risk.
Both goals cannot be met simultaneously, but we can use
optimization to explore the trade-offs involved.
Powell, S. G., & Baker, K. R. (2014). Management science: The art of modeling with
spreadsheets (4th ed.).Wiley. ISBN: 9781118582695 (print version); ISBN:
100 words for each Q
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