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1. (50 marks) Huawei decided to expand in Africa. Three possible factory sites are availab Nairobi, Cape Town, and Accra. Factory building costs and transport
1. (50 marks) Huawei decided to expand in Africa. Three possible factory sites are availab Nairobi, Cape Town, and Accra. Factory building costs and transport costs to major customer zones from each site are given below. Factory Site Cape Town Building Cost (per million unit capacity) 560,000 Production Cost/unit 60 Nairobi 75 340,000 Accra 45 310,000 Customer Zone Demand/yr Transport Costs/unit Cape Town Nairobi Accra #1 #2 #3 18 million 6 3 4 15 million 8 5 12 9 million 16 7 6 #4 26 million 2 5 22 Huawei has a building budget of 40 million USD next year. Huawei does not wish annual logistics costs to exceed 40% of total production costs. Write a model that decides which factories will be built in what capacity while meeting annual demand and minimizing all costs. USE PARAMETERS BELOW! Parameters: TRC(ij): transport cost; D(j): demand for zone j; B(i): building cost per million capacity for site i; pr(i): production cost for site i Variables: Model
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