A distribution system consists of three factories, three regional warehouses, and four retailers. Production costs are $62 per unit at Factory 1, $61.50 per unit at Factory 2, and $63 per unit at Factory 3. Costs of shipping from the factories to the regional warehouses are given in Table 1, and costs of shipping from the warehouses to the retailers are given in Table 2. Factory 1 can produce up to 3800 units per month, Factory 2 up to 2800 units per month, and Factory 3 up to 4000 units per month. The four retailers require at least 2400, 2800, 2900, and 2100 units per month, respectively. You must decide how much to produce and ship to each regional warehouse from each factory, and how much to ship from each regional warehouse to each retailer to minimize total monthly costs. Build a linear programming spreadsheet model and solve it using Solver. Warehouse 1 Warehouse 2 Warehouse 3 Factory 1 Factory 2 Factory 3 $7.60 $5.75 $6.10 $4.75 $7.15 $4.70 $3.70 $6.15 $5.00 Table 1. Shipping Cost per Unit from Factories to Warehouses Retailer 1 Retailer 2 Retailer 3 Retailer 4 $3.80 $2.25 $3.00 $2.70 $3.05 $4.35 $3.20 $3.05 $3.25 $2.55 $4.45 $2.05 Warehouse 1 Warehouse 2 Warehouse 3 Table 2. Shipping Cost per Unit from Warehouses to Retailers

A distribution system consists of three factories, three regional warehouses, and four retailers. Production costs are $62 per unit at Factory 1, $61.50 per unit at Factory 2, and $63 per unit at Factory 3. Costs of shipping from the factories to the regional warehouses are given in Table 1, and costs of shipping from the warehouses to the retailers are given in Table 2. Factory 1 can produce up to 3800 units per month, Factory 2 up to 2800 units per month, and Factory 3 up to 4000 units per month. The four retailers require at least 2400, 2800, 2900, and 2100 units per month, respectively. You must decide how much to produce and ship to each regional warehouse from each factory, and how much to ship from each regional warehouse to each retailer to minimize total monthly costs. Build a linear programming spreadsheet model and solve it using Solver. Warehouse 1 Warehouse 2 Warehouse 3 Factory 1 Factory 2 Factory 3 $7.60 $5.75 $6.10 $4.75 $7.15 $4.70 $3.70 $6.15 $5.00 Table 1. Shipping Cost per Unit from Factories to Warehouses Retailer 1 Retailer 2 Retailer 3 Retailer 4 $3.80 $2.25 $3.00 $2.70 $3.05 $4.35 $3.20 $3.05 $3.25 $2.55 $4.45 $2.05 Warehouse 1 Warehouse 2 Warehouse 3 Table 2. Shipping Cost per Unit from Warehouses to Retailers

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter5: Network Models

Section: Chapter Questions

Problem 68P

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