A company currently ships products from 5 plants to 4 warehouses. The company is considering the option of closing down one or more plants. This would increase distribution cost but perhaps lower overall cost. What plants, if any, should the company close? Transportation Costs (per 1000 products) Plant 1 Plant 2 Plant 3 Plant 4 Plant 5 Warehouse 1 $4,000 $2,000 $3,000 $2,500 $4,500 Warehouse 2 $2,500 $2,600 $3,400 $3,000 $4,000 Warehouse 3 $1,200 $1,800 $2,600 $4,100 $3,000 Warehouse 4 $2,200 $2,600 $3,100 $3,700 $3,200 Demand from warehouses are: Demand Warehouse 1 15,000 Warehouse 2 18,000 Warehouse 3 14,000 Warehouse 4 20,000 Capacity of plants are: Plant 1 Plant 2 Plant 3 Plant 4 Plant 5 Capacity 20,000 22,000 17,000 19,000 18,000 Fixed operating costs for each plants: Plant 1 Plant 2 Plant 3 Plant 4 Plant 5 Fixed Cost $12,000 $15,000 $17,000 $13,000 $16,000
A company currently ships products from 5 plants to 4 warehouses. The company is considering the option of closing down one or more plants. This would increase distribution cost but perhaps lower overall cost. What plants, if any, should the company close? Transportation Costs (per 1000 products) Plant 1 Plant 2 Plant 3 Plant 4 Plant 5 Warehouse 1 $4,000 $2,000 $3,000 $2,500 $4,500 Warehouse 2 $2,500 $2,600 $3,400 $3,000 $4,000 Warehouse 3 $1,200 $1,800 $2,600 $4,100 $3,000 Warehouse 4 $2,200 $2,600 $3,100 $3,700 $3,200 Demand from warehouses are: Demand Warehouse 1 15,000 Warehouse 2 18,000 Warehouse 3 14,000 Warehouse 4 20,000 Capacity of plants are: Plant 1 Plant 2 Plant 3 Plant 4 Plant 5 Capacity 20,000 22,000 17,000 19,000 18,000 Fixed operating costs for each plants: Plant 1 Plant 2 Plant 3 Plant 4 Plant 5 Fixed Cost $12,000 $15,000 $17,000 $13,000 $16,000
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter6: Optimization Models With Integer Variables
Section6.5: Set-covering And Location-assignment Models
Problem 34P
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A company currently ships products from 5 plants to 4 warehouses. The company is considering the option of closing down one or more plants. This would increase distribution cost but perhaps lower overall cost. What plants, if any, should the company close?
| Transportation Costs (per 1000 products) | |||||||
| Plant 1 | Plant 2 | Plant 3 | Plant 4 | Plant 5 | |||
| Warehouse 1 | $4,000 | $2,000 | $3,000 | $2,500 | $4,500 | ||
| Warehouse 2 | $2,500 | $2,600 | $3,400 | $3,000 | $4,000 | ||
| Warehouse 3 | $1,200 | $1,800 | $2,600 | $4,100 | $3,000 | ||
| Warehouse 4 | $2,200 | $2,600 | $3,100 | $3,700 | $3,200 | ||
| Demand from warehouses are: | |||||||
| Demand | |||||||
| Warehouse 1 | 15,000 | ||||||
| Warehouse 2 | 18,000 | ||||||
| Warehouse 3 | 14,000 | ||||||
| Warehouse 4 | 20,000 | ||||||
| Capacity of plants are: | |||||||
| Plant 1 | Plant 2 | Plant 3 | Plant 4 | Plant 5 | |||
| Capacity | 20,000 | 22,000 | 17,000 | 19,000 | 18,000 | ||
| Fixed operating costs for each plants: | |||||||
| Plant 1 | Plant 2 | Plant 3 | Plant 4 | Plant 5 | |||
| Fixed Cost | $12,000 | $15,000 | $17,000 | $13,000 | $16,000 | ||
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