Further explanation of Reduced Costs
Def.:
- Products whose marginal profits are less than the marginal value of the goods required for their production will not be produced in an optimal solution (unless a constraint forces the product to be produced)
- Reduced costs tell us by how much we would have to increase the profitability of an item before it would be included in the optimal solution (for a maximisation problem). And vice-versa for a minimisation problem.
