(a) Formulate (in thousands of dollars). (Let x = units shipped in thousands from plant i to distribution center j with the existing plant in St. Louis being plant number 5. Let y, = 1 if a plant is constructed in Detroit and 0 if not, y, = 1 if a plant is constructed in Toledo and o if not, y, = 1 if a plant is constructed in Denver and O if not, and y, = 1 if a plant is constructed in Kansas City and O if not.) mixed-integer programming model that could be used to help Martin-Beck determine which new plant or plants to open in order to satisfy anticipated demand and minimize total cost Min s.t. Detroit Capacity Toledo Capacity Denver Capacity Kansas City Capacity St. Louis Capacity Boston Demand Atlanta Demand Houston Demand X 2 0 for all i and j and y, Y2, Y3, Y4 binary

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The Martin-Beck Company operates a plant in St. Louis with an annual capacity of 30,000 units. Product is shipped to regional distribution centers located in Boston, Atlanta, and Houston. Because of
an anticipated increase in demand, Martin-Beck plans to increase capacity by constructing a new plant in one or more of the following cities: Detroit, Toledo, Denver, or Kansas City. The estimated
annual fixed cost and the annual capacity for the four proposed plants are as follows:
Plant Number
Proposed Plant Annual Fixed Cost Annual Capacity
Detroit
$200,000
10,000
2
Toledo
$275,000
20,000
Denver
$350,000
30,000
4
Kansas City
$525,000
40,000
The company's long-range planning group developed forecasts of the anticipated annual demand at the distribution centers as follows.
Distribution
Center Number
Distribution
Annual Demand
Center
1.
Boston
20,000
2
Atlanta
30,000
3
Houston
30,000
The shipping cost per unit from each plant to each distribution center is as follows.
Distribution Centers
Plant Site Boston Atlanta Houston
Detroit
Toledo
4
4
Denver
7
Kansas City
10
4
2
St. Louis
8
4
3
Transcribed Image Text:The Martin-Beck Company operates a plant in St. Louis with an annual capacity of 30,000 units. Product is shipped to regional distribution centers located in Boston, Atlanta, and Houston. Because of an anticipated increase in demand, Martin-Beck plans to increase capacity by constructing a new plant in one or more of the following cities: Detroit, Toledo, Denver, or Kansas City. The estimated annual fixed cost and the annual capacity for the four proposed plants are as follows: Plant Number Proposed Plant Annual Fixed Cost Annual Capacity Detroit $200,000 10,000 2 Toledo $275,000 20,000 Denver $350,000 30,000 4 Kansas City $525,000 40,000 The company's long-range planning group developed forecasts of the anticipated annual demand at the distribution centers as follows. Distribution Center Number Distribution Annual Demand Center 1. Boston 20,000 2 Atlanta 30,000 3 Houston 30,000 The shipping cost per unit from each plant to each distribution center is as follows. Distribution Centers Plant Site Boston Atlanta Houston Detroit Toledo 4 4 Denver 7 Kansas City 10 4 2 St. Louis 8 4 3
(a) Formulate a mixed-integer programming model that could be used to help Martin-Beck determine which new plant or plants to open in order to satisfy anticipated demand and minimize total cost
(in thousands of dollars). (Let x = units shipped in thousands from plant i to distribution center j with the existing plant in St. Louis being plant number 5. Let y, = 1 if a plant is constructed in
Detroit and 0 if not, y, = 1 if a plant is constructed in Toledo and 0 if not, y, = 1 if a plant is constructed in Denver and O if not, and y. = 1 if a plant is constructed in Kansas City and O if not.)
Min
s.t.
Detroit Capacity
Toledo Capacity
Denver Capacity
Kansas City Capacity
St. Louis Capacity
Boston Demand
Atlanta Demand
Houston Demand
Xy 2 0 for all i and j and y,, y2, Y3, Y4 binary
(b) Solve the model you formulated in part (a). What is the optimal cost (in $)?
What is the optimal set of plants to open? (Select all that apply.)
O Detroit
O Toledo
O Denver
O Kansas City
Transcribed Image Text:(a) Formulate a mixed-integer programming model that could be used to help Martin-Beck determine which new plant or plants to open in order to satisfy anticipated demand and minimize total cost (in thousands of dollars). (Let x = units shipped in thousands from plant i to distribution center j with the existing plant in St. Louis being plant number 5. Let y, = 1 if a plant is constructed in Detroit and 0 if not, y, = 1 if a plant is constructed in Toledo and 0 if not, y, = 1 if a plant is constructed in Denver and O if not, and y. = 1 if a plant is constructed in Kansas City and O if not.) Min s.t. Detroit Capacity Toledo Capacity Denver Capacity Kansas City Capacity St. Louis Capacity Boston Demand Atlanta Demand Houston Demand Xy 2 0 for all i and j and y,, y2, Y3, Y4 binary (b) Solve the model you formulated in part (a). What is the optimal cost (in $)? What is the optimal set of plants to open? (Select all that apply.) O Detroit O Toledo O Denver O Kansas City
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