• TelecomOne is one of the premier manufacturers of fibre optic telecommunication equipment in the United States. It has manufacturing plants located at Baltimore, Memphis, Wichita, Wyoming & Salt Lake City. TelecomOne serves markets in Atlanta, Boston, Chicago, Denver, Omaha & Portland. The capacity in each of the manufacturing plant, the variable costs (production, inventory and transportation costs) and the fixed costs of running the operations and the demand at each of the markets is given in Table 1: Table 1: Production, Inventory and Transportation Costs (1000 $) Atlanta Boston Chicago Denver Omaha Portland Capacity (1000 units) Monthly Fixed Costs (1000 $) Baltimore 1675 400 685 1630 1160 2800 18 7650 Wyoming 1460 1940 970 100 495 1200 24 3500 Salt Lake City 1925 2400 1425 500 950 800 27 5000 Memphis 380 1355 543 1045 665 2321 22 4100 Wichita 922 1646 700 508 311 1797 31 2200 Monthly Demand (1000 units) 10 8 14 6 7 11 Management at TelecomOne wants to identify the plants that should be closed down (based on the variable costs and the fixed monthly costs) and also the optimal allocation of demand to the manufacturing units and so that the total cost is minimised. Your consulting team has been approached by the top-management at TelecomOne for this particular analysis. Develop a linear/integer programming model and answer the following questions: 1. Build and solve an optimisation model for TelecomOne to identify the plants that should be in operation and the ones that should be closed down. Identify the optimal allocation of demand to the production plants so that the total cost (variable costs--production, inventory and transportation costs and fixed costs of running the plants) is minimised. - Clearly state what are the decision variables of the optimisation model. 2. Historical data show that demand requirement at Atlanta and Boston may change to 16000 and 10000 instead of 10000 and 8000 units respectively. TelecomOne would like your team to analyse the impact of this scenario. How would the optimal solution and the total cost change under this scenario?