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John Moffat.
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kevinchin
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One of the assumption of linear programming is there is only a single objective i.e. either maximising profit or minimising costs.
When a question state that the objective function is to maximise contribution. Is this the same as to maximise NPV when I define the function?
John Moffat
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No it isn’t the same – contribution is not the same as NPV. (Contributions do not involve discounting!).
I cannot imagine that Paper AFM would ask about maximising contribution.
Have you watched my free lectures on multi-period capital rationing?
kevinchin
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