The Audiofile Company produces boomboxes. However, management has decided to subcontract out the production of the speakers needed for the boomboxes. Three vendors are available to supply the speakers. Shipments from vendors would go one of the companys two warehouses. Whenever one of the companys two factories needs a shipment of speakers to assemble into the boomboxes, the company hires a truck to bring the shipment in from one of the warehouses. The shipping cost is given next along with the number of shipments needed per month at each factory.

Each vendor is able to supply as many as 10 shipments per month. However, because of shipping limitations, each vendor is only able to send a maximum of 6 shipments per month to each warehouse. Similarly, each warehouse is only able to send a maximum of 6 shipments per month to each factory.

Management now wants to develop a plan for each month regarding how many shipments (if any) to order from each vendor, how many of those shipments should go to each warehouse, and then how many shipments each warehouse should send to each factory. The objective is to minimize the total shipping costs.

1(A) Draw a network that depicts the companys supply network. Identify supply nodes, transshipment nodes, and demand nodes in this network.

1(B) Formulate a network model using the template provided in Excel. Use Solver to solve the problem.

Below, use sensitivity report to answer the following two questions.

1(C) If the shipping cost from Warehouse 1 to Factory 2 increases by 10%, how the optimal solution and total cost would change?

1(D) If the shipping cost from Warehouse 2 to Factory 2 increases by 10%, how the optimal solution and total cost would change?

\begin{tabular}{|c|c|c|c|} \hline Totalshippingcost & WH1 & WH2 & Supply \\ \hline V1 & $23,440 & $22,960 & 10 \\ \hline V2 & $23,150 & $23,200 & 10 \\ \hline V3 & $23,200 & $23,000 & 10 \\ \hline \end{tabular} \begin{tabular}{|c|c|c|} \hline Totalshippingcost & F1 & F2 \\ \hline WH1 & 200 & 700 \\ \hline WH2 & 400 & 500 \\ \hline Monthlydemand & 10 & 6 \\ \hline \end{tabular}