This allows us to solve the €œKnapsack problem€� in Excel.
and am quite worried that it claims to have optimized when it has not.

Hi. Just to mention ...
Excel's Solver does have a logic problem in that if the 'finite
difference' in its derivative calculation indicates a problem, Solver
will immediately finish, usually without any warnings. Solver will quit
on the first hint of a problem.
For example, if your model uses discontinuous functions like IF(),
MAX(), MIN(), etc, then this "usually" causes a problem. The results
are most often not reliable. The model must be re-written in linear form.
= = = = = = = = =
Dana DeLouis



On 11/19/09 10:31 AM, Alec Erskine wrote:
I am delighted to see that Microsoft have made an important development in
Excel 2007 with their optimiser. You have effectively introduced a
combinatorial optimiser in Excel 2007 which was not available in Excel 2003.
This allows us to solve the €œKnapsack problem€� in Excel. The Knapsack
problem, sometimes called the Capital Investment problem is as follows.
Suppose we have a list of schemes, each with defined cost and defined
benefit, and we have a budget ceiling. Which schemes should we do to
maximise the total benefit, while keeping the total cost under budget? The
Excel version appears to use the fairly robust method of a standard linear
simplex optimiser combined with a branch-and-bound searcher. Can you
confirm?

An example involving 70 schemes with randomised C and B is easy to create.
There seems to be a small starting position effect in that you seem to have
to run the optimiser twice from 0s to get it to work properly, it only gets
the €œright€� answer €“ or what I hope is the right answer on the second attempt.

I would have assumed that this optimser is independent of starting position
and am quite worried that it claims to have optimised when it has not. This
is a bug, really. Any thoughts as to why it is finishing at the wrong answer?

I cannot find any email addresses on your site to send this to and am being
warned not to send contact information. So I guess that's it then.

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