Economic Models - Convex Optimization

166 Anna-Maria Mouza
increase for each group, the number of employees per group together with
the ranking scores, I computed the index presented in the 4th column of
Table 6. Multiplying the elements of this column by 59,090.0625, we get
the entries of the 5th column.
From the last column of Table 6, I computed the end period salary
of each group and the corresponding annual rate of increase, which are
presented in Table 7.
From Table 7, we can see that the requirement for the annual rate of
salary increase at each group to exceed 3.1%, is fully satisfied. In an opposite
situation however, one has to reduce the value of “a” by, say, 0.05 and
to repeat all calculations. It should be also noted that with the allocation
proposed so far, total initial salary, spending will increase by an annual
rate of 3.69% (from 807,300 to 967,629.9) and the annual wage per capita
will increase by 19.86% (from 15,232.1 to 18,257.2). It is clear that all
employees will be better off with smaller value of a. The composite index
and all other entries of Tables 6 and 7 can be computed with the following
code segment written in Visual Fortran.
MODULE data_and_params
! Goups=number of groups ! Planning_hor=Planning horizon (years)
! R = Initial rate of salary increase at each group (vector)
! Members = Number of employees at each group (vector)
! Salary_in = Initial employees salary at each group (vector)
! Salary_f = Final claimed salary for each group (vector)
! Deficit = The value of deviational variable
! a = Value of coefficient a (0