Modify the warehouse location model as suggested inModeling Issue 2. Specifically, assume that the samefour customers have the same annual shipments, butnow, there are only two possible warehouse locations,each with distances to the various customers. (Thesedistances, along with other inputs, are in the fileP07_27.xlsx.) The company can build either or bothof these warehouses. The cost to build a warehouseis $50,000. (You can assume that this cost has beenannualized. That is, the company incurs a buildingcost that is equivalent to $50,000 per year.) If onlyone warehouse is built, it will ship to all customers. However, if both warehouses are built, then the com-pany must decide which warehouse will ship to each customer. There is a traveling cost of $1 per mile.a. Develop an appropriate model to minimize totalannual cost, and then use Solver to optimize it.Is this model an NLP or an IP model (or both)?b. Use SolverTable with a single input, the traveling costper mile, to see how large this cost must be before thecompany builds both warehouses rather than just one.

Modify the warehouse location model as suggested inModeling Issue 2. Specifically, assume that the samefour customers have the same annual shipments, butnow, there are only two possible warehouse locations,each with distances to the various customers. (Thesedistances, along with other inputs, are in the fileP07_27.xlsx.) The company can build either or bothof these warehouses. The cost to build a warehouseis $50,000. (You can assume that this cost has beenannualized. That is, the company incurs a buildingcost that is equivalent to $50,000 per year.) If onlyone warehouse is built, it will ship to all customers. However, if both warehouses are built, then the com-pany must decide which warehouse will ship to each customer. There is a traveling cost of $1 per mile.a. Develop an appropriate model to minimize totalannual cost, and then use Solver to optimize it.Is this model an NLP or an IP model (or both)?b. Use SolverTable with a single input, the traveling costper mile, to see how large this cost must be before thecompany builds both warehouses rather than just one.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter5: Network Models

Section: Chapter Questions

Problem 67P

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