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Allied Freight supplies goods to three customers. The company has two warehouses. The warehouse availabilities, the customer requirements, and the unit shipping costs from warehouses to customers are shown in the file P05_67.xlsx. There is a penalty for each unsatisfied customer unit of demand, and these penalties are also listed in the same file. a. Determine how to minimize the sum of penalty and shipping costs. b. Use SolverTable to see how a change in the unit penalty cost of customer 1 affects the optimal cost. c. Use SolverTable to see how a change in the capacity of warehouse 1 affects the optimal cost.

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Practical Management Science

6th Edition
WINSTON + 1 other
Publisher: Cengage,
ISBN: 9781337406659

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Chapter
Section
BuyFindarrow_forward

Practical Management Science

6th Edition
WINSTON + 1 other
Publisher: Cengage,
ISBN: 9781337406659
Chapter 5, Problem 67P
Textbook Problem
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Allied Freight supplies goods to three customers. The company has two warehouses. The warehouse availabilities, the customer requirements, and the unit shipping costs from warehouses to customers are shown in the file P05_67.xlsx. There is a penalty for each unsatisfied customer unit of demand, and these penalties are also listed in the same file.

  1. a. Determine how to minimize the sum of penalty and shipping costs.
  2. b. Use SolverTable to see how a change in the unit penalty cost of customer 1 affects the optimal cost.
  3. c. Use SolverTable to see how a change in the capacity of warehouse 1 affects the optimal cost.

a)

Summary Introduction

To determine: The way to minimize the sum of penalty and shipping cost.

Introduction: In linear programming, the unbounded solution would occur when the objective function is infinite. If no solution satisfied the constraints, then it is said to be unfeasible solution.

Explanation of Solution

Determine the total cost:

b)

Summary Introduction

To determine: The way the change in penalty cost affects the optimal cost.

Introduction: In linear programming, the unbounded solution would occur when the objective function is infinite. If no solution satisfied the constraints then it is said to be unfeasible solution.

c)

Summary Introduction

To determine: The way the change in warehouse capacity affects the optimal cost.

Introduction: In linear programming, the unbounded solution would occur when the objective function is infinite. If no solution satisfied the constraints, then it is said to be unfeasible solution.

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