Optimal transportation of goods in a supply chain
Consider the following example that demonstratesoptimization of transportation.
There are production facilities in Battle Creek, CherryCreek, and Dee Creek with annual
capacities of 500 units, 400 units, and 600 units,respectively. The annual demands at
warehouses in Worchester, Dorchester, and Rochester are 300units, 700 units, and 400
units, respectively. The table below gives the unittransportation costs between the
production facilities and the warehouses.
Worchester Dorchester Rochester
Battle Creek $20/unit $30/unit $13/unit
Cherry Creek $10/unit $5/unit $17/unit
Dee Creek $15/unit $12/unit $45/unit
How much of the demand at each of the warehouses must be metby each of the production facilities?
This problem can be modeled as a linear programming model asfollows:
Decision Variables
Xbw = # of units to be transported from Battle Creek toWorchester
Xcw = # of units to be transported from Cherry Creek toWorchester
Xdw = # of units to be transported from Dee Creek toWorchester
Xbd = # of units to be transported from Battle Creek toDorchester
Xcd = # of units to be transported from Cherry Creek toDorchester
Refer to the example in theModule Seven lecture document. Solve the linear programming model using theMicrosoft Excel Solver tool