Constraints – “When initially considering a managerial problem, we usually find that the problem , we usually find that the problem definition phase leads to a specific objective, such as maximization of profit or minimization of cost, and possibly a set of restrictions or constraints, which express limitations on resources.” (p.8)
Constraints can be seen as the limitation of one source in order to maximize another source or sources. Constraints can also be seen as spending money that may limit how much a manager may spend without going over budget. It can also mean a certain amount of money may need to be set aside for monthly expenses such as bills or maybe even promotions.
Objective function – “The mathematical expression that defines the quantity to be maximized or minimized is referred to as the objective function.” (p.8)
An objective function can be a number that may limit or interfere with the actual outcome of the results that are outside the constraints. Exceeding the cost of material that may be used during the production of a product can produce an objective function.
Uncontrollable inputs – “Such factors, which can affect both the objective function and the constraints, are referred to as uncontrollable inputs to the model.” (p.9)
An uncontrollable input may include the cost of electricity, rental equipment, water, and other environmental factors which are required in order to produce a product. The uncontrollable inputs will always be the factors which are not able to calculate such as non-production days because of weather or maintenance for equipment that may not have been expected.
Controllable inputs – “Inputs that are controlled or determined by the decision maker are referred to as controllable inputs to the model.” (p.9)
The controllable inputs may include such things as labor, labor hours, bonuses, promotions, and other inputs which can help reduce the cost depending on profits. Controlling the how the inputs are arranged and entered can either effect profits and costs in a negative or positive outcome for the company.
Decision variables – “Controllable inputs are the decision alternatives specified by the manager and thus are also referred to as the decision variables of the model.” (p.9)
Decision variables are the inputs that can be changed or left out of the equations based upon the specific needs of a manager and what the manager wants to accomplish during a certain time frame. The decision variables can be continuously altered to maximized or minimize profits or products cost.

Reference

Anderson, David R. Quantitative methods for business. Mason, OH: South-Western, Cengage Learning, 2013. Print.