Seoul's company produces medical equipment for diagnosing tuberculosis in four factories. Four partner hospitals on Jeju Island have placed orders for production this month. The table below shows the cost of shipping each unit from each factory to each hospital, the number of units to be produced at each factory and the number of units ordered by each hospital.   Managers and Leaders of Seoul’s company aim to minimize the total cost of shipping by determining how many units will be shipped from each factory to each hospital. Based on this case: a) Formulate a linear programming model for this problem! b) Determine the optimal solution for this model using the North West Corner transportation method, the Vogel Method and the Stepping-Stone!

MARKETING 2018
19th Edition
ISBN:9780357033753
Author:Pride
Publisher:Pride
Chapter1: An Overview Of Strategic Marketing
Section1.2: Dollar Shave Club: The Company For Men
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Seoul's company produces medical equipment for diagnosing tuberculosis in four factories. Four partner hospitals on Jeju Island have placed orders for production this month. The table below shows the cost of shipping each unit from each factory to each hospital, the number of units to be produced at each factory and the number of units ordered by each hospital.

 

Managers and Leaders of Seoul’s company aim to minimize the total cost of shipping by determining how many units will be shipped from each factory to each hospital. Based on this case:

a) Formulate a linear programming model for this problem!

b) Determine the optimal solution for this model using the North West Corner transportation method, the Vogel Method and the Stepping-Stone!

c) Make a dual equation for the above case and analyze the shadow price using the software (Lingo/Lindo)!

 

From
Factory 1
Factory 2
Factory 3
Factory 4
Order totals (thousand)
Cost of shipping each unit (million dollar)
Hospital 1 Hospital 2 Hospital 3 Hospital 4
600
800
700
800
400
900
600
560
250
700
650
775
250
660
500
475
345
345
620
300
Output
(thousand)
420
520
320
350
Transcribed Image Text:From Factory 1 Factory 2 Factory 3 Factory 4 Order totals (thousand) Cost of shipping each unit (million dollar) Hospital 1 Hospital 2 Hospital 3 Hospital 4 600 800 700 800 400 900 600 560 250 700 650 775 250 660 500 475 345 345 620 300 Output (thousand) 420 520 320 350
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