Three electric power plants with capacities of 25, 40 and 30 million kWh supply electricity to three cities. The maximum demands at the three cities are estimated at 30, 35 and 25 million kWh. The price per million kWh at the three cities is given in following table.

During the month of august, there is a 20% increase in demand at each of the three cities which can be met by purchasing electricity from another network at a premium rate of $1000 per million kWh. The network is not linked to city three however, the utility company wishes to determine the most economical plan for the distribution and purchase of additional energy.

a) Formulate the problem as a transportation model.

b) Determine an optimal distribution plan for the utility company.

c) Determine the cost of the additional power purchase by each of the three cities.

	1	2	3
1	$600	$700	$400
2	$320	$300	$350
3	$500	$480	$450