**Linear programming** has been used to determine the optimal value that will satisfy all of the constraints and conditions specified by the problems. Although the existing linear programming is already been quite useful, excel moves one step forward and provides an additional tool named sensitivity analysis reports. These reports are very useful if you want to vary the variable and see how the outcomes are behaving. In this article, we will discuss how you can run **linear programming** in Excel and generate **sensitivity analysis**.

## Introduction to Linear Programming

**Linear Programming **is an important aspect of **Statistics **and **Applied Mathematics**. You can perform predictive analysis with prevalent data variables. It helps us in the optimization of resources. We must have some constraints and an objective function for that purpose. The **Excel Solver **can quickly figure out the solutions to Linear Programming problems in Excel.

## What Is Sensitivity Analysis?

We can use **Excel **to carry out many different mathematical operations. **Linear Programming **is an aspect of **Statistics **and **Applied Mathematics**. This has huge practical applications. **Solving Linear Programming** problems manually can seem a hassle. On the other hand, we have **Excel Solver** which can find out the solutions to those problems very readily. In this article, weâ€™ll show you the step-by-step procedures to **Use Excel Solver **for **Linear Programming**.

## Perform Linear Programming with Sensitivity Analysis in Excel: Step-by-Step Procedure

To illustrate, weâ€™ll use the following business problem as an example.

Suppose,Â a manufacturer has two kinds of products, â€˜**A**â€™ & â€˜**B**â€™. A single unit of product **A** requires three raw materials,** P 25 **kg, **Q 35 **kg, and** R 10 **kg. Similarly, **B** requires** P 15 **kg, **Q 20 **kg, and **R 15 **kg. The Manufacture needs a minimum of **P 500 **kg, **Q 850 **kg, and **R 300 **kg. If **A **costs **$35** per unit and **B **costs **$30** per unit, how many units of each product should the manufacturer blend to meet the minimum raw material requirements at a low cost as possible, and what is the price?

Now, to solve this problem, go through the below steps carefully and also learn how to use **Excel Solver **for Linear Programming.

### STEP 1: Enable Solver in Excel

The **Solver **is an **MS Excel** add-in program. It stays deactivated by default. So, you need to enable it for using the program. Therefore, follow the process to perform the task.

- First, go to
**File**âž¤**Options**. - Then, select the
**Add-ins**tab. - After that, choose
**Excel Add-ins**from the**Manage**drop-down. - Subsequently, press
**Go**.

- As a result, the
**Add-ins**dialog box will pop out. - Now, check the box for
**Solver Add-in**. - Next, press
**OK**.

- Thus, youâ€™ll see the
**Solver**program in the**Analyze**section under the**Data**tab.

**Read More:** How to Use Excel Solver for Linear Programming

### STEP 2: Input Constraints

In this step, weâ€™ll input the **Constraints **and the **Objective Function **in the **Excel **worksheet. According to the problem, suppose, weâ€™ll blend **x **units of product **A **and **y **units of **B**. So the total cost will be **$35x + $30y**. This is our objective function and we want to minimize this cost. At the same time, we have to meet the requirements. **25x + 15y >= 500**, **35x + 20y >= 850**, **10x+15y >= 300**,** x >= 0 **and **y >= 0** are our constraints. Now, weâ€™ll input these.

- First of all, type the per-unit costs of
**A**and**B**. - See the following picture to understand better.
- Next, input the materials under the respective products.
- Insert the minimum required amounts.

### STEP 3: Create Excel Formula

- Weâ€™ll insert the value of
**x**in cell**C5**and**y**in cell**D5**. - Firstly, select cell
**E6**. - Then, type the formula:

**=($C$5*C6)+($D$5*D6)**

- Press
**Enter**. - Itâ€™ll return
**0**or**blank**as the**C5**and**D5**cell values are empty for the moment.

- Afterward, select the cell
**E9**to type the formula:

**=($C$5*C9)+($D$5*D9)**

- Consequently, press
**Enter**to return the values. - Use
**the AutoFill tool**to complete the rest. - For now, the results are
**0**as**C5**and**D5**are empty.

### STEP 4: Solve Linear Programming with Sensitivity Report

- Now, select the
**Solver**program under the**Data**tab. - Accordingly, the
**Solver Parameters**dialog box will emerge. - Next, choose cell
**E6**in the**Set Objective**box. - After that, check the circle for
**Min**. - Select the range
**C5:D5**as variable cells. - The following image demonstrates the process clearly.
- Then, press
**Add**for adding the constraints.

- The
**Add Constraint**dialog box will appear. - Choose the range
**C5:D5**and click the**>=**(**greater than or equal to**) symbol from the drop-down. - Type
**0**. - Press
**Add**afterward.

- Moreover, choose the range
**E9:E11**for minimum requirement constraints. - Click the
**>=**symbol from the drop-down. - Select the range
**G9:G11**in the**Constraint**field. - Press
**OK**.

- Hence, youâ€™ll see the desired constraints.
- Press
**Solve**.

- Youâ€™ll get a dialog box about the solved results.
- Check the circle for
**Keep Solver Solution**. - And also select
**Sensitivity**in**Reports**section.

- Press
**OK**. - Lastly, itâ€™ll return the precise results in the appointed cells.

**Read More:** How to Find Optimal Solution in Linear Programming Excel

## Interpretation of Sensitivity Analysis in Excel

The most important goal of the sensitivity analysis reports is to give people an idea of how their variables can be changed or altered to what extent. In other words, with Excel’s sensitivity analysis, you may change the model’s underlying assumptions and examine the output for a variety of potential outcomes. All investing is statistical since you can’t know with certainty what will happen in 5, 10, or 15 years, but you may think of a plausible range of possible outcomes.

Here, allowable increases and decreases denote how much the optimal value outcome can be altered so that the model still remains optimal. User can enter their preferable value and test this model and report.

**Download Practice Workbook**

Download the following workbook to practice by yourself.

## Conclusion

Henceforth, you will be able to execute linear programming with sensitivity analysis reports in excel as demonstrated here following the above-described procedures. Feel free to ask any questions or feedback through the comment section.

**Related ArticlesÂ **

- How to Calculate Shadow Price Linear Programming in Excel
- Perform Mixed Integer Linear Programming in Excel
- How to Graph Linear Programming in ExcelÂ
- How to Do Linear Programming in Excel
- How to Solve Transportation Problem with Linear Programming
- How to Solve Integer Linear Programming in Excel
- How to Solve Blending Linear Programming Problem with Excel Solver

**<< Go Back to Excel Linear Programming | Solver in ExcelÂ |Â Learn Excel**