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. Musicale Inc. produces a battery-operated recorder located in Kenya, Libya and Penson. The unit transportation cost for shipments from the three plants to distribution
Musicale Inc. produces a battery-operated recorder located in Kenya, Libya and Penson. The unit transportation cost for shipments from the three plants to distribution centers in Turquoise, Opal, and Monty are as follows: From To Turquoise Opal Monty Kenya 1.45 1.60 1.40 Libya 1.10 2.25 0.60 Penson 1.20 1.20 1.80 After considering transportation and other factors, management has decided that under no circumstances will it use the Libya-Opal route. The plant capacities and distributor orders for the next month are as follows: Plant Capacity (units) Distributor Orders (units) Kenya 400 Turquoise 400 Libya 600 Opal 400 Penson 300 Monty 400 Because of different wage scales at the three plants, the unit production cost varies from plant to plant. Assume the costs are $30.00 per unit at Kenya, $30.20 per unit at Libya and $30.35 per unit at Penson. a) Formulate this problem as a transportation problem, that determines the production and distribution plan that minimizes production and transportation costs. b) Solve the problem using the transportation algorithm and determine the optimal solution. What is the cost associated with your solution?
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