Problem
Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used as a raw material by manufacturers of plastic goods around the U.S. SP currently operates four manufacturing centers in Philadelphia, PA; Atlanta, GA; St. Louis, MO; and Salt Lake City, UT. The plants have different capacities and production costs as indicated in the table below.
|
PLANT
|
MAXIMUM CAPACITY
(× 100,000 LBS.)
|
PROD. COST
(PER 1,000 LBS.)
|
|
Philadelphia
|
8.3
|
$324.00
|
|
Atlanta
|
9.3
|
$274.00
|
|
St. Louis
|
12.1
|
$304.00
|
|
Salt Lake City
|
10.1
|
$249.00
|
SP currently has six contract customers located in New York City; Birmingham, AL; Terre Haute, IN; Dallas, TX; Spokane, WA; and San Diego, CA. Transportation costs between the plants and various customers, as well as contracted demand from each customer, are shown in the table below.
|
|
TRANSPORT COSTS PER 1,000 LBS.
|
|
FROM/TO
|
NYC
|
BIRMINGHAM
|
TERRE HAUTE
|
DALLAS
|
SPOKANE
|
SAN DIEGO
|
|
Philadelphia
|
$47
|
$54
|
$58
|
$64
|
$70
|
$87
|
|
Atlanta
|
57
|
44
|
60
|
61
|
72
|
84
|
|
St. Louis
|
59
|
62
|
52
|
56
|
57
|
72
|
|
Salt Lake City
|
74
|
73
|
69
|
59
|
50
|
62
|
|
Total Demand
(× 1,000 lbs.)
|
528
|
417
|
928
|
603
|
328
|
403
|
• Create a solver model and find the optimal solution to help SP develop a distribution plan that will minimize costs to supply the customers' demand.