An Introduction to Management Science 13th Edition by David Anderson,Dennis Sweeney ,Thomas Williams ,Jeffrey Camm, Kipp Martin

Exercise 10

Arnoff Enterprises manufactures the central processing unit (CPU) for a line of personal computers. The CPUs are manufactured in Seattle, Columbus, and New York and shipped to warehouses in Pittsburgh, Mobile, Denver, Los Angeles, and Washington, D.C., for further distribution. The following table shows the number of CPUs available at each plant, the number of CPUs required by each warehouse, and the shipping costs (dollars per unit):
a. Develop a network representation of this problem.
b. Determine the amount that should be shipped from each plant to each warehouse to minimize the total shipping cost.
c. The Pittsburgh warehouse just increased its order by 1000 units, and Arnoff authorized the Columbus plant to increase its production by 1000 units. Will this production increase lead to an increase or decrease in total shipping costs? Solve for the new optimal solution.