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Problem 15-9 (Algo) Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used as a raw material by manufacturers of plastic goods around the
Problem 15-9 (Algo) Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used as a raw material by manufacturers of plastic goods around the U.S. SP currently operates four manufacturing centers in Philadelphia, PA; Atlanta, GA; St. Louis, MO; and Salt Lake City, UT. The plants have different capacities and production costs as indicated in the table below. PLANT Philadelphia Atlanta St. Louis Salt Lake City MAXIMUM CAPACITY (* 100,000 LBS.) 7.4 9.0 12.4 10.3 PROD. COST (PER 1,000 LBS.) $336.00 $286.00 $316.00 $261.00 SP currently has six contract customers located in New York City, Birmingham, AL; Terre Haute, IN; Dallas, TX; Spokane, WA; and San Diego, CA. Transportation costs between the plants and various customers, as well as contracted demand from each customer, are shown in the table below. FROM/TO Philadelphia Atlanta St. Louis Salt Lake City Total Demand (x 1,000 lbs.) NYC $50 60 62 77 TRANSPORT COSTS PER 1,000 LBS. BIRMINGHAM TERRE HAUTE DALLAS SPOKANE $57 $61 $67 $62 47 63 64 64 65 55 59 49 76 72 62 42 SAN DIEGO $95 92 80 70 536 425 936 604 325 411 a. Create a solver model and find the optimal solution to help SP develop a distribution plan that will minimize costs to supply the customers' demand. (Enter your answers in terms of cost per 1,000 lbs and shipment quantities per 1,000 lbs. Round your answers to the nearest whole number.) Combined Costs Per 1,000 lbs. Birmingham Terre Haute Dallas NYC Spokane San Diego From/To Philadelphia Atlanta St. Louis Salt Lake City Solution (1,000 lbs.) Birmingham Terre Haute NYC Dallas Spokane San Diego From/To Philadelphia Atlanta St. Louis Salt Lake City Received 536 425 936 604 325 411 Total Costs Terre Haute NYC Birmingham Dallas Spokane San Diego From/To Philadelphia Atlanta St. Louis Salt Lake City Total cost $ 1,122,495
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