Posted: November 9th, 2015

Management Science

Management Science

Answer question 8 parts a and b.

Distribution and Network models:

8. Forbelt Corporation has a one year contract to supply motors for all refrigerators produced by the Ice Age

Corporation. Ice Age manufactures the refrigerators at four locations around the country: Boston, Dallas, Los

Angeles, and St. Paul. Plans call for the following number (in thousands) of refrigerators to be produced at

each location:

Boston: 50

Dallas: 70

Los Angeles: 60

St. Paul: 80

Forbelt’s three plants are capable of producing the motors. The plants and production capacities (in

thousands) are as follows:

Denver: 100

Atlanta: 100

Chicago: 150

Because of varying production and transportation costs, the profit that Forbelt earns on each lot of 1000

units depends on which plant produced the lot and which destination it was shipped to. The following table

gives the accounting department estimates of the profit per unit (shipments will be made in lots of 1000

units):

Shipped To

Produced at:             Boston              Dallas                 Los Angeles                        St.

Paul

Denver                         7                       11                        8

13

Atlanta                         20                     17                         12

10

Chicago                       8                       18                         13

16

With profit maximization as a criterion, Forbelt’s management wants to determine how many motors should be

produced at each plant and how many motors should be shipped from each plant to each destination.

a. Develop a network representation of this problem.

b. Find the optimal solution

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