The logistic company headquartered in New York wants to expand its business in Chicago, Texas, and Las Vegas. They will place 3 branch heads (A, B a, nd C) from several branch offices owned by the company to set-up offices and run operations in these 3 locations. Below are the costs for allocating the 3 branch heads to each location: Chicago Texas Las Vegas A $8,000,000 $11,000,000 $12,000,000 B $5,000,000 $15,000,000 $13,000,000 C $5,000,000 $10,000,000 $23,000,000 a. Create a table using the assignment method. b. Based on the results of your calculations, what advice can you give to the leader of the company for the most optimum company location placement of each of the above branch heads? Explain why? c. What is the total optimum cost that must be incurred by the company to allocate all company branch offices?

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
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The logistic company headquartered in New York wants to expand its business in Chicago, Texas, and Las Vegas. They will place 3 branch heads (A, B a, nd C) from several branch offices owned by the company to set-up offices and run operations in these 3 locations. Below are the costs for allocating the 3 branch heads to each location:

  Chicago Texas Las Vegas
A $8,000,000 $11,000,000 $12,000,000
B $5,000,000 $15,000,000 $13,000,000
C $5,000,000 $10,000,000 $23,000,000

a. Create a table using the assignment method.
b. Based on the results of your calculations, what advice can you give to the leader of the company for the most optimum company
location placement of each of the above branch heads? Explain why?
c. What is the total optimum cost that must be incurred by the company to allocate all company branch offices?

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