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DECISION VARIABLE: The Problem Is To Determine How Many Steel Mills To Transport From Production

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TRANSPORTATION, TRANSSHIPMENT, & ASSIGNMENT

CASE PROBLEM

PROBLEM STATEMENT

Steel mills in three cities produce the following amounts of steel:

LOCATION WEEKLY PRODUCTION (TONS)


Bethlehem 150
Birmingham 210
Gary 320
Total 680

These mills supply steel to four cities, where manufacturing plants have the following demand:

LOCATION WEEKLY DEMAND (TONS)


Detroit 130
St. Louis 70
Chicago 180
Norfolk 240
Total 620

Shipping costs per


ton of steel are as follows:

To cost
From 1 2 3 4
A $14 $9 $16 $18
B $11 $8 $7 $16
C $16 $12 $10 $22

a. Because of a truckers’ strike, shipments are prohibited from Birmingham to Chicago. Formulate
this problem as a linear programming model and solve it by using the computer.

DECISION VARIABLE: The problem is to determine how many steel mills to transport from production
cities to each supplied cities to minimize the total cost of transportation; representing the cities are:

x1 = Steel mills to Detroit from:

x1A = Bethlehem
x1B = Birmingham
x1C = Gary
x2 = Steel mills to St. Louis from:
x2A = Bethlehem
x2B = Birmingham
x2C = Gary

x3 = Steel mills to Chicago from:

x3A = Bethlehem
x3C = Gary

x4 = Steel mills to Norfolk from:

x4A = Bethlehem
x4B = Birmingham
x4C = Gary

OBJECTIVE FUNCTION: To minimize shipping cost represented in:

Minimize Z = 14x1A + 11x1B + 16x1C + 9x2A + 8x2B + 12x2C +16x3A +7x3B + 10x3C + 18X4A +
16x4B + 22X4C

MODEL CONSTRAINTS: The constraints in this problem are the demand, production and the truck strike
from Birmingham to Chicago. The constraint for production is:

x1A + x2A + x3A + x4A = 150

x1B + x2B + x3B + x4B = 210

x1C + x2C + x3C + x4C = 320

The constraint for demand is:

x1A + x1B + x1C = 130

x2A + x2B + x2C = 70

x3A + x3B + x3C = 180

x4A + x4B + x4C = 240

The constraint for truck strike is:

x3B = 0
The complete model for this problem is:

Minimize Z = 14x1A + 11x1B + 16x1C + 9x2A + 8x2B + 12x2C +16x3A +7x3B + 10x3C + 18X4A +
16x4B + 22X4C

Subject to:

x1A + x2A + x3A + x4A = 150

x1B + x2B + x3B + x4B = 210

x1C + x2C + x3C + x4C = 320

x1A + x1B + x1C = 130

x2A + x2B + x2C = 70

x3A + x3B + x3C = 180

x4A + x4B + x4C = 240

x3B = 0

xij ≥ 0

b. What would be the effect on the optimal solution of a reduction in production capacity at the Gary
mill from 320 tons to 290 tons per week?

INTEGER PROGRAMMING

CASE PROBLEM

PROBLEM STATEMENT

The artisans at Jewelry Junction in Phoenix are preparing to make gold jewelry during a 2-month period
for the Christmas season. They can make bracelets, necklaces, and pins. Each bracelet requires 6.3
ounces of gold and 17 hours of labor, each necklace requires 3.9 ounces of gold and 10 hours of labor,
and each pin requires 3.1 ounces of gold and 7 hours of labor. Jewelry Junction has available 125 ounces
of gold and 320 hours of labor. A bracelet sells for $1,650, a necklace for $850, and a pin for $790. The
store wants to know how many of each item to produce to maximize revenue.

a. Formulate an integer programming model for this problem.

b. Solve this model by using the computer.


c. Compare this solution with the solution with the integer restrictions relaxed and indicate whether the
rounded-down solution would have been optimal.

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