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American Steel, an Ohio-based steel manufacturing company, produces steel at its two steel mills located at Youngstown and Pittsburgh. The company distributes finished steel to

American Steel, an Ohio-based steel manufacturing company, produces steel at its two steel mills located at Youngstown and Pittsburgh. The company distributes finished steel to its retail customers through the distribution network of regional and field warehouses shown below:

The network represents the shipment of finished steel from American Steel's two steel mills located at Youngstown (node 1) and Pittsburgh (node 2) to their field warehouses at Albany, Houston, Tempe, and Gary (nodes 6, 7, 8, and 9) through three regional warehouses located at Cincinnati, Kansas City, and Chicago (nodes 3, 4 and 5). Also, some field warehouses can be directly supplied from the steel mills.

Table 1, presents the minimum and maximum flow amounts of steel that may be shipped between different cities along with the cost per 1000 ton/month of shipping the steel.

Table 1 Arc Costs and Limits

From node

To node

Cost

Minimum

Maximum

Youngstown

Albany

500

-

1000

Youngstown

Cincinnati

350

-

3000

Youngstown

Kansas City

450

1000

5000

Youngstown

Chicago

375

-

5000

Pittsburgh

Cincinnati

350

-

2000

Pittsburgh

Kansas City

450

2000

3000

Pittsburgh

Chicago

400

-

4000

Pittsburgh

Gary

450

-

2000

Cincinnati

Albany

350

1000

5000

Cincinnati

Houston

550

-

6000

Kansas City

Houston

375

-

4000

Kansas City

Tempe

650

-

4000

Chicago

Tempe

600

-

2000

Chicago

Gary

120

-

4000

The current monthly demand at American Steel's four field warehouses is shown in Table 2.

Table 2 Monthly Demands

Field Warehouses

Monthly Demand

Albany, N.Y.

3000

Houston

7000

Tempe

4000

Gary

6000

The Youngstown and Pittsburgh mills can produce up to 10,000 tons and 15,000 tons of steel per month, respectively. The management wants to know the least cost monthly shipment plan.

Show the related LP to your transportation model.

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