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Integer Optimization Problem: General Appliance corporation (GAC) produces refrigerators at two plants: Marietta, Georgia and Minneapolis, Minnesota. They ship them to major distribution centers in

Integer Optimization Problem:

General Appliance corporation (GAC) produces refrigerators at two plants: Marietta, Georgia and Minneapolis, Minnesota. They ship them to major distribution centers in Cleveland, Baltimore, Chicago, and Phoenix. The accounting, production, and marketing departments have provided the information in Table 14.6, which shows the unit cost of shipping between any plant and distribution center, plant capacities over the next planning period, and distribution center demands. GACs supply chain manager faces the problem of determining how much to ship between each plant and distribution center to minimize the total transportation cost, not exceed available capacity, and meet customer demand.

Plant

Cleveland

Baltimore

Chicago

Phoenix

Capacity

Marietta

$12.60

$14.35

$11.52

$17.58

1,500

Minneapolis

$9.75

$16.26

$8.11

$17.92

800

Demand

150

350

500

1,000

For the General Appliance corporation transportation model, suppose that the company wants to enforce a single sourcing constraint that each distribution center be served from only one plant. Setup and solve a model to find the minimum cost solution

Define decision variables and formulate the optimization model. Explain well the objective and each type of the constraints. Solve the model with EXCEL Solver and interpret the printouts obtained. Indicate any pertinent, interesting, or unusual results you may find.

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