firm producing a single product has three plants and four customers. The three plants will produce 6, 8 and 4 units, respectively, during the next period. The firm has made a commitment to sell 4 units to customer 1, 6 units to customer 2, and at least 2 units to customer 3. Both customers 3 and 4 also want to buy as many of the remaining units as possible. The net profit associated with shipping a unit from a plant I for sale to customer j is given by the following table:
Customer
1 2 3 4
1 8 7 5 2
Plant 2 5 2 1 3
3 6 4 3 5
Management wishes to know how many units to sell to customers 3 and 4 and many units to ship from each of the plants to each of the customers to maximize profit.
- Formulate this problem as a transportation problem by constructing the appropriate cost and requirements table.
- Find the initial feasible solution using northwest corner method