Whenever a constraint has positive slack, the shadow price is equal to one.

Name: Whenever a constraint has positive slack, the shadow price is equal to one.
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Question

Quizplus · Accepted Answer

The shadow price is the rate of improvement in the objective function per unit increase in the right-hand side of the constraint. Positive slack means the constraint is not binding, and typically, the shadow price for a non-binding constraint is zero, not one.

Whenever a Constraint Has Positive Slack, the Shadow Price Is