TRANSPORTATION PROBLEMS

1. A company has four factories supplying four warehouses and its management wants to determine
the minimum-cost shipping schedule for its weekly output of chests. Factory supply, warehouse
demands, and shipping costs per one chest (unit) are shown below:

Shipping Cost per unit (in $)

Warehouse
Factory E F G H Supply
A 10 30 25 15 15
B 20 15 20 10 6
C 10 30 20 20 14
D 30 40 35 45 11
Demand 10 12 15 9

2. A corporation A has a contract to supply motors for all tractors produced by a corporation B.
Corporation B manufactures the tractors at three locations around Central Europe: Prague, Warsaw
and Budapest. Corporation A has four plants that can produce the motors. Due to varying
production and transportation costs, the profit earned on each motor depends on where they were
produced and where they were shipped. The following transportation table gives the accounting
department estimates of the euro profit per unit (motor):

Profit Earned Per Motor (in Euro)

Tractor Locations
Motor Plants Prague Warsaw Budapest # Motors Produced
Hamburg 10 30 25 8
Munich 20 15 20 7
Leipzig 10 30 20 10
Dresden 30 40 35 5
# Tractors Produced 9 12 9

Find an initial feasible solution using the Vogel’s Approximation Method. Find the optimal allocation
using MOdified DIstribution method.

3. Consider the problem represented by the following transportation tableau where there are 3
factories and 4 warehouses:

W1 W2 W3 W4 Supply
F1 10 0 20 11 20
F2 12 7 9 20 25
F3 0 14 16 18 15
Demand 10 15 15 20

Find the initial basic feasible solution using (a) the North West corner rule (b) the Matrix Minima
method (c) Vogel’s approximation. Compare the methods. Also compare the transportation costs
and comment.
4. For the transportation problem given by the following tableau, find an initial basic feasible solution
by the least-cost method and then find an optimal solution.

D D2 D3 Supply
1
S1 2 1 3 7
S2 4 5 6 8
Demand 5 6 4

5. For the transportation problem given by the following tableau, find an initial basic feasible solution
by the North-West corner method and then find an optimal solution.

R1 R2 R3 R4 R5 Supply
F1 10 15 10 12 20 8
F2 5 10 8 15 10 7
F3 15 10 12 12 10 10
Demand 5 9 2 4 5

6. In Problem 5, the supply at Source 3 is now reduced from 10 to 6. There is a penalty of 5 for each
unit required but not supplied. Find the new optimal solution.

7. Three refineries with maximum daily capacities of 6, 5, and 8 million gallons of oil supply three
distribution areas with daily demands of 4, 8 and 7 million gallons. Oil is transported to the three
distribution areas through a network of pipes. The transportation cost is 1 pence per 100 gallons per
mile. The mileage table below shows that refinery 1 is not connected to distribution area 3.
Formulate the problem as a transportation model and solve it.

Distribution Area
Refinery 1 2 3
1 120 180 —
2 300 100 80
3 200 250 120

8. In Problem 4, suppose additionally that the capacity of refinery 3 is reduced to 6 million gallons.
Also, distribution area 1 must receive all its demand, and any shortage at areas 2 and 3 will result in
a penalty of 5 pence per gallon. Formulate the problem as a transportation model and solve it.

9. In Problem 4, suppose the daily demand at area 3 drops to 4 million gallons. Any surplus production
at refineries 1 and 2 must be diverted to other distribution areas by tanker. The resulting average
transportation costs per 100 gallons are £1.50 from refinery 1 and £2.20 from refinery 2. Refinery 3
can divert its surplus oil to other chemical processes within the plant. Formulate the problem as a
transportation model and solve it.

10. Five warehouses are supplied by four factories. The supply available from each factory, the demand
at each warehouse and the cost per unit of transporting goods from the factories to the warehouses
are summarized in the following table:
 W1 W2 W3 W4 W5 Supply
F1 13 9 15 10 12 40
F2 11 10 12 12 9 10
F3 12 9 11 12 9 20
F4 13 12 13 12 10 10
Demand 12 15 20 15 18

(a) Use the North-West Corner method to find an initial basic feasible solution of this problem.
(b) Find the optimal solution of this problem.

11. For the transportation problem given by the following tableau, find an initial basic feasible solution
by the North-West corner method and then find an optimal solution.

Supply
9 15 12 10
6 8 13 23
9 3 11 27
Demand 21 14 25

12. An organization has four destinations and three sources for supply of goods. The transportation cost
per unit is given below. The entire availability is 700 units which exceeds the cumulative demand of
600 units. Decide the optimal transportation scheme for this case.

D1 D2 D3 D4 Availability
S1 13 16 19 17 250
S2 17 19 16 15 200
S3 15 17 17 16 250
Requirement 10 150 250 100
0

13. Consider the transportation problem presented in the following table.

Distribution centre
Plant D1 D2 D3 D4 Supply
P1 19 30 50 12 7
P2 70 30 40 60 10
P3 40 10 60 20 18
Requirement 5 8 7 15

Determine the optimal solution of the above problem.

14. Consider the following transportation problem (cost in rupees)

Distributor
Factory D E F Supply
A 2 1 5 10
 B 7 3 4 25
C 6 5 3 20
Requirement 15 22 18 55

Find out the minimum cost of the given transportation problem.

15. Consider the following transportation problem (cost in rupees)

Distributor
Factory D E F Supply
A 2 1 5 10
B 7 3 4 25
C 6 5 3 20
Requirement 15 22 18 55

Find out the minimum cost of the given transportation problem.

16. The following matrix gives data concerning the transportation times.

Destination
Origin D1 D2 D3 D4 D5 D6 Supply
O1 25 30 20 40 45 37 37
O2 30 25 20 30 40 20 22
O3 40 20 40 35 45 22 32
O4 25 24 50 27 30 25 14
Demand 15 20 15 25 20 10

Find the optimum allocation that minimizes the transportation times.

17. A Company has 3 production facilities S1, S2 and S3 with production capacity of 7, 9 and 18 units (in
100's) per week of a product, respectively. These units are tobe shipped to 4 warehouses D1, D2, D3
and D4 with requirement of 5,6,7 and 14 units (in 100's) per week, respectively. The transportation
costs (in rupees) per unit between factories to warehouses are given in the table below.

D1 D2 D3 D4 Capacity
S1 19 30 50 10 7
S2 70 30 40 60 9
S3 40 8 70 20 18
Demand 5 8 7 14 34

Find initial basic feasible solution for given problem by using

(a) North-West corner method
(b) Least cost method
(c) Vogel's approximation method
Obtain an optimal solution by MODI method, if the object is to minimize the total transportation
cost.
18. Find an initial basic feasible solution for given transportation problem by using
(a) North-West corner method
(b) Least cost method
(c) Vogel's approximation method

D1 D2 D3 D4 Supply
S1 11 13 17 14 250
S2 16 18 14 10 300
S3 21 24 13 10 400
Demand 200 225 275 250

19. A company has factories at F1, F2 and F3 which supply to warehouses at W1, W2 and W3. Weekly
factory capacities are 200, 160 and 90 units, respectively. Weekly warehouse requirement are 180,
120 and 150 units, respectively. Unit shipping costs (in rupees) are as follows:

W1 W2 W3 Supply
F1 16 20 12 200
F2 14 8 18 160
F3 26 24 16 90
Demand 180 120 150 450

Determine the optimal distribution for this company to minimize total shipping cost.

20. Find an initial basic feasible solution for given transportation problem by using
(a) North-West corner method
(b) Least cost method
(c) Vogel's approximation method

P Q R S Supply
A 6 3 5 4 22
B 5 9 2 7 15
C 5 7 8 6 8
Demand 7 12 17 9 45

21. Avertz Rent-a-Car needs to redeploy its automobiles to correct imbalances in the system. Currently,
Avertz has too many cars in New York (with 10 cars excess) and Chicago (12 cars excess). Pittsburgh
would like up to 6 cars, Los Angeles up to 14 cars, and Miami up to 7 cars (note that more cars are
demanded than are available). The cost of transporting a car from one city to another is given by:

Pittsburgh Los Angeles Miami

New York 50 250 100
Chicago 25 200 125

(a) Find the optimum allocation of cars that will minimize the transportation cost.
(b) It turns out that unmet demand costs $50/car in Pittsburgh, $75/car in LA, and $100/car in
Miami. Solve the revised transportation problem.
22. Solve the following transportation problem:

Customer Supply
Factory 1 2 3
1 40 47 80 100
2 72 36 58 200
3 24 61 71 300
Demand 200 200 200

23. A concrete company transports concrete from three plants 1, 2 and 3, to three construction sites, A,
B, and C. The cost of transporting 1 ton of concrete in pounds per ton from each plant to each site,
the supply (capacity) of the plants, and requirements of the sites (both in number of tons per week)
are given below:

Sites
Plants A B C Supply
1 4 3 8 300
2 7 5 9 300
3 4 5 5 100
Requirement 200 200 300

Find the optimal number of tons to transport from each plant to each site so as to minimize the total
cost of transportation. Use the North-West Corner Rule to get the initial BFS (Basic Feasible
Solution).

24. Due to road-works, the cost of shipping 1 ton from Plant 1 to Site A, in Example 24, increases to 6
pounds. Obtain the optimal solution for the revised problem by starting with a VAM solution
initially.

25. A steel company has three mills, M1, M2 and M3, which can produce 40, 10 and 20 kilotons of steel
each year. Three customers, C 1, C2, and C3, have requirements of 12, 18, and 40 kilotons repectively
in the same period. The cost, in units of 1,000 pounds, of transporting a kiloton of steel from each
mill to each customer is shown in the figure below:

Formulate the problem of carrying out the transportation at a minimum cost as a LPP. Find the
optimum allocation that minimizes the cost of transportation using MODI method after finding the
initial feasible solution using the Least Cost method.
26. A transportation problem involves the following costs, supply and demand:

W1 W2 W3 Supply
F1 7 8 6 4
F2 9 2 4 3
F3 5 6 3 8
Demand 2 9 4

Formulate as an LPP. Find the optimum solution using MOdified DIstribution method.

27. Downside Mills produces carpets at plants in Abbeyville (A) and Bridgeway (B). The carpet is shipped
to two outlets in Courtney (C) and Dove Valley (D). The cost, in pounds per ton, of shipping carpets
from each of the two plants to each of the two outlets is as follows:

Outlets
Plants C D
A 20 32
B 35 15

The plant at Abbeyville can supply 250 carpets per week and the plant at Bridgeway can supply 300.
The Courtney outlet has a demand for 320 carpets and the outlet at Dove Valley has a demand for
230 tons per week. The company wants to know the number of carpets to ship from each plant to
each outlet in order to minimize the total shipping cost. Formulate this transportation problem as a
LPP. Find the initial basic feasible solution using (a) North-West Corner Rule (b) Matrix Minima
method, and (c) Vogel’s Approximation Method. Also find the optimum solution. What is the
percentage decrease in the costs by using the optimum solution over each of the three methods?

28. Use the North-West Corner Rule to obtain an initial solution for the transportation tableau below:

Sites
Plants A B C Supply
1 10 12 9 40
2 4 5 7 50
3 11 8 6 60
Demand 70 50 30 150

Find the optimal solution that minimizes the total transportation cost.

29. Use the North-West Corner Rule to obtain an initial solution for the following transportation tables:

(a) (b)
Supply Supply
100 60
40 40
50 140
Demand 60 60 70 Demand 120 80 40
 (c) (d)

Supply Supply
60 90
100 40
80 50
Demand 60 70 110 Demand 60 70 50

30. For the transportation table below, write down the (a) north-west (b) north-east (c) south-west, and
(d) south-east corner solutions. Given that one of these is an optimal solution, obtain the optimal
solution.

A B Supply
1 8 6 100
2 10 12 150
Demand 90 160

31. A company has three factories F 1, F2, and F3, and three warehouses W1, W2, and W3. The table below
shows the respective transportation costs, availabilities, and requirements:

To W1 W2 W3 Availability
From
F1 8 6 7 4
F2 2 4 9 3
F3 6 3 5 8
Requirement 9 4 2
(a) Use the North-West Corner Rule to write down a possible pattern of distribution and find its
cost.
(b) Find the optimal solution starting from the initial solution you obtained in (a).

32. A company has three warehouses W1, W2, and W3, which are supplied by three suppliers S 1, S2, and
S3. The table below shows the respective transportation costs, availabilities, and requirements:

W1 W2 W3 Availability
S1 10 4 11 14
S2 12 5 8 10
S3 9 6 7 6
Requirement 8 10 12

(a) Use the Least Cost method to find an initial feasible solution.
(b) Find the optimal allocation to minimize the total transportation cost.
(c) Find an alternate optimal solution to this problem. [Hint: Select the cell that is unallocated but
has cij – (ui + vj) = 0 as the starting point of the loop, and do one more iteration of the MODI
method]
33. A lumber company ships pine flooring from its three mills, A 1, A2, and A3, to three building suppliers,
B1, B2, and B3. The table below shows the demand, availabilities and unit costs of transportation.
Starting with the Vogel’s approximation method, and the MODI method, find the optimal solution to
minimize costs.

B1 B2 B3 Availability
A1 3 3 2 25
A2 4 2 3 40
A3 3 4 3 31
Demand 30 30 36

35. A manufacturing company has three factories F 1, F2, and F3, and two retail outlets R 1 and R2. It
wishes to transport its products from its factories to its outlets at minimum total cost. The table
below gives the details of demand and supply, and also the unit costs of transportation.

To
From R1 R2 Supply
F1 2 6 30
F2 2 4 60
F3 6 9 20
Demand 60 20

(a) Write down the north-west corner solution.

(b) Show that this solution is optimal.
(c) State the optimal transportation pattern and give its cost.

36. A transportation problem involves the following costs, supply and demand:

To
From D1 D2 D3 Supply
S1 7 8 10 50
S2 9 7 8 60
Demand 70 30 40

(a) Is the problem balanced?

(b) Find the initial solution using VAM.
(c) Obtain and interpret the optimal solution. Give the minimum cost.

37. Consider the following transportation tableau:

To A B C Supply
From
1 5 4 12 200
2 8 6 10 100
3 11 7 11 200
Demand 100 200 200
 Find the initial solution using the Matrix Minima method. Test for optimality. Find the optimal
cost.

38. Consider the following transportation tableau:

To A B C Supply
From
1 2 4 5 150
2 3 8 6 200
Demand 100 150 100

Find the initial solution using the Matrix Minima method. Check for optimality. Find the optimal
cost.

39. A manufacturing company produces diesel engines in three cities, C 1, C2, and C3, and they are
purchased by three trucking companies, T 1, T2, and T3. The table below shows the number of
engines available at C1, C2, and C3 and the number of engines required by T 1, T2, and T3. It also
shows the transportation cost per engine (in 100 pounds) from sources to destinations. The
company wishes to keep the total transportation costs to a minimum.

To T1 T2 T3 Supply
From
C1 3 2 3 25
C2 4 2 3 35
C3 3 2 6 20
Demand 30 30 20

(a) Find the north-west corner solution and check for degeneracy.
(b) Find the optimal solution.
(c) Give the optimal transportation pattern and its cost.

40. A builders’ merchant has 13 tons of sand at Site X, 11 tons at Site Y and 10 tons at Site Z. He has
orders for 9 tons from Customer A, 13 tons from Customer B, and 12 tons from Customer C. The
cost per ton (in 10 pounds) of moving the sand between sites and customers is given in the table
below:

A B C
X 1 2 4
Y 1 3 4
Z 5 7 5

(a) Find the VAM solution.

(b) Obtain the optimal solution. State the minimum cost of transportation.

41. A transportation problem involves the following costs, supply and demand:
 D1 D2 D3 Supply
S1 17 8 14 30
S2 15 10 20 20
S3 20 5 10 10
Demand 10 20 30

(a) Find the Least Cost solution.

(b) Obtain the optimal solution and give its cost.

42. A factory producing aluminum is supplied with bauxite from three mines (01, 02 and 03) which
produce 3, 7 and 5 thousand tons of mineral per week respectively. There are 4 modes of
transportation of bauxite to the factory: by ship (T1) - by trucks (T2) - by a simple railway wagon
(T3) - by special railway wagons (T4). The total capacity per day is 4 thousand tons for ships, 3
thousand for cars and 4 thousands each one of the two types of rail. Transportation costs per
ton are given in the following table:

Vehicles T1 T2 T3 T4
Mines
01 2 2 2 1
02 10 8 5 4
03 7 6 6 8

Identify the quantities that must be transported by any means of transportations so as to

minimize the total transportation cost.

43. One of the main products of P & T Company, a large canning industry is canned beans. There are
three canneries which send products to four distribution centers. Since transportation costs are
particularly increased due to large distances, the administration decided to reduce it. There
have been some estimates of the quantity production and transportation to distribution centers
and as for the transportation costs of each load (fully loaded truck company) it is denominated
in U.S. dollars.

Distribution Centers
Canneries 1 2 3 4 Production
1 464 513 654 867 75
2 352 416 690 791 125
3 995 682 388 685 100
Demand 80 65 70 85

Find the combination of the transportation load that minimizes the total transportation cost.

44. A company that produces an innovative product has two branches and three main customers.
The two branches will produce 60 units and 40 units respectively of the product during the next
period. The company is committed to sell 50 units to the first customer and at least 20 units to
the third customer. The second and the third customer also want to buy as many units from
those remaining. The profit of the company (expressed in thousands of euro) depending on the
 transportation of its branches to customers is given in the following table.

Customer
1 2 3
Branch 1 5 7 6
Branch 2 2 3 5

How should we distribute the products in order to maximize the total profit?

45. Factories X, Y and Z of a business have a monthly production capacity of a chemical product 22,
15 and 8 tons respectively. This production covers the needs of four consumer centers, which
need 7, 12, 17 and 8 tons per month. The cost of transporting one tone (in €) from the factories
in the centers of consumption is indicated in the following table.

Consumer Ι ΙΙ ΙΙΙ ΙV
center
Factory
Χ 5 2 4 3
Y 4 8 1 6
Ζ 4 6 7 5

The responsible officer has formed the following program based on his experience: Χ -> ΙΙ: 12
tons, Χ -> ΙΙΙ: 1 tone, Χ -> ΙV: 9 tons, Y -> ΙΙΙ: 15 tons, C -> Ι: 7 tons, C -> ΙΙΙ: 1 tone.
Consider whether the transportation program developed is the best possible. If not, then
determine the optimum solution.

46. A commercial company has three stores, let it be A, B and C, from which supplies its three main
largest customers, let it be M, N and Q, with a consumer product. All warehouses have
approximately the same size as with corresponding capacity of 50 tons for this product. The
three customers require a certain period of time 30, 45 and 25 tons respectively. Transportation
cost (in €) of each tone from each warehouse to each customer is as follows:

Customer
Warehouse Μ Ν Q
A 30 40 10
B 20 10 50
C 70 20 20

The company's management wants to know whether it would be desirable to eliminate one of
the warehouses and sell the corresponding stock. What in your opinion is the most appropriate
decision?

47. A company has three branches which produce a particular product that after production is
transported to distribution centers. Branches 1, 2 and 3 produce 12, 17 and 11 loads per month
respectively. Each distribution center needs to collect 10 loads per month. The distance from
each branch in the respective distribution centers is given (in kms.) in the following table:
 Distribution center
Branch 1 2 3 4
1 800 1,300 400 700
2 1,100 1,400 600 1,000
3 600 1,200 800 900

The fixed cost of each load is € 30 and the extra charge is € 1.50/km.
a) Design the appropriate transportation model.
b) Using the method of the northwest corner find the initial basic feasible solution.
c) Starting with the initial basic feasible solution determined to the question (b) find the
optimal solution. How many loads must be transferred from each branch to each
distribution center in order to minimize the total transportation cost?

48. Let us suppose that England, France and Spain produce the whole wheat, barley and oats in the
world. The demand for wheat in the world requires 125 million hectares available for its
production. Similarly, 60 million hectares of land are required for the production of barley and
75 for the production of oats. The total area available for this purpose in England, France and
Spain is 70, 110 and 80 million hectares respectively. The number of hours required in England,
France and Spain for the production of wheat in one hectare of land is 18, 13 and 16 hours
respectively. The corresponding hours in the three countries for the production of barley in a
hectare of land is 15, 12 and 12 hours respectively. The number of hours required in England,
France and Spain for the production of oats in one hectare of land is 12, 10 and 16 hours
respectively. The cost for each working hour for the production of wheat in England, France and
Spain is $ 3, $ 2.40 and $ 3.30 per hour respectively. The comparable costs for every working
hour for the production of barley is $ 2.70, $ 3 and $ 2.80 respectively, while for the production
of oats is $ 2.30, $ 2.50 and $ 2.10 respectively.
The problem that must be addressed is the distribution of land used for each country so as to
meet global needs and simultaneously minimize the total labor costs. Design and resolve the
appropriate transportation model.

49. The company SAS has a chain of stores that sell equipment, hi-fi. The shareholders are thinking
of ordering new midi systems, which then would sell 430 pounds. The shops are separated into
three geographical areas, north, west and south and SAS believes that the demand for the
system in each area will be 170, 210 and 150 units respectively. The SAS has decided to order
100 units for each geographic area stores. There are three potential suppliers for the system A,
B and C. A is capable of supplying 200 units for 400 pounds the one, the B 160 units for 420
pounds the one and C 180 units for 410 pounds the one. These prices do not include the
transportation costs that vary with the supplier and the supply contract according to the
following table.

Stores
Suppliers North West South
Α 20 10 5
Β 5 15 20
Γ 30 10 25
(Unit transportation cost in British pounds)
 The SAS wants to maximize the profit from the sales of the new system. Design and solve the
corresponding transportation problem.

50. An airline company buys fuel for the plane from three vendors. The company needs for each of
the three airports that uses and for the next month’s 100000 gallons for the first, 180000 gallons
for the second and 35000 gallons for the third airport. Each vendor can supply fuel to any
airport in the price (dollars per gallon) given in the table below.
 Airport 1 Airport 2 Airport 3
Seller 1 0.92 0.89 0.90
Seller 2 0.91 0.91 0.95
Seller 3 0.87 0.90 0.92

Each seller has a restriction on the total amount of fuel that can be supplied each month. The
potential is 320000 gallons for the Seller 1, 1270000 gallons for the Seller 2 and 190000 gallons
for the Seller 3.
Find the right fuel purchasing policy so as to minimize the total cost of feeding the three
airports.

51. A farmer's association has launched public competition for the daily transportation of some
cereal from the head offices of the three regional warehouses. The daily requirements of the
warehouses are amounted to 18, 10 and 8 tons respectively. Overall offers were submitted by
three carriers, each specifying the maximum amount of weight that can carry per day. These
quantities are equal for all three companies with 12, 16 and 24 tons respectively. The costs for
the transportation of one ton of grain from each company in the three regional warehouses are
presented (in €) in the following table:

Warehouses
7,000 4,000 10,000
Companies 5,000 3,000 9,000
6,000 5,000 9,000

What contracts exactly would you advise the administration of the partnership to sign, so that
on the one hand to minimize the total transportation cost, on the other hand not the
administration be accused for bias in favor of or against any of the carriers?

52. A food industry produces chips at three factories, located in Birmingham, Glasgow and London.
Since the customers should be supplied with fresh products, these are not stored in the
factories. The monthly production ability of the factory in London is 750 tons, while of the other
two are 500 tons. Every day 300 tons are given to the five warehouses in order to subsequently
be transferred to customers. The profit per sale tone from the first warehouse is 0.4 pounds if
produced in London, 0.6 if produced in Glasgow and 2.2 pounds if produced in Birmingham. The
corresponding gains for the second warehouse are 1.1, 1.2 and 2 pounds.
The profit per ton of production in London is 1.7, 1.3 and 2.5 pounds when sold by the third,
fourth and fifth warehouse respectively. The corresponding gains for Birmingham are 1.6, 1 and
0.5 pounds, while for Glasgow are 1.1, 0.8 and 2.1 pounds.
What is the maximum monthly profit that can be achieved by the industry?

53. One major producer wants to buy raw material that does not exist in large stock. He needs to
purchase 100 tons per week for the operation of the three factories, which have regular weekly
requirements 40, 15 and 45 tons respectively. It is possible to satisfy these requirements if it
obtains 40, 35 and 25 tons per week from three different suppliers. The cost of each unit of raw
material is charged the same from any supplier, but the buyer must pay the costs of
transportation for the three factories 6, 3.6 and 4.8 pounds for the first supplier, 2.4, 1.2 and 0.6
pounds for the second supplier and 6, 4.8 and 3.6 pounds for the third supplier, respectively.
 (a) How should the producer make the orders to minimize the total transportation cost and
simultaneously meet requirements of the factory?
(b) Assume that in the initial problem the requirement of the first factory is 50 tons per week,
of the second factory 15 tons a week and of the third factory 35 tons per week.
Determine the optimal solution and compare with that of the initial problem.

54. A pastry company produces a special type of bread in two branches with the following
production data.

Branch Production capacity (kg) Production cost ($/kg)

Α 2,500 0.23
Β 2,100 0.25

Four restaurant chains want to purchase this special type of bread. Their requirements and the
amount they offer are given in the table below:

Chain Maximum demand (in kg) Offering price ($/kg)

1 1,800 0.39
2 2,300 0.37
3 550 0.40
4 1,750 0.36

Transportation costs (in $) of one kg of bread from each branch of the chain restaurants are:

Chain 1 Chain 2 Chain 3 Chain 4

Branch Α 0.06 0.08 0.11 0.09
Branch B 0.12 0.06 0.08 0.05

Design the delivery plan, which maximizes the net profit.

55. A wholesaler sells some food in four major markets, let it be A, B, C and D. The weekly demand
has been accurately predicted and is 40 bags for the market A, 30 for B and C and 20 bags for
the market D. The wholesaler always orders the goods he markets from two local producers, P &
R. The first of them charges €1 for the transportation of one bag in market A, € 4 for B, € 5 for C
and € 6 for D.
As expected the cost of food is charged separately. The producer P charges €1 for the
transportation bags to the market A, €2 for B, €7 for C and €9 for D, without including the cost
of the product. One particular week both producers can supply from 65 bags, but the producer P
sells food for €1 more per bag than R.
Which are the orders which must be placed this week by the wholesalers?
Next week the producers can still supply the same quantities, but now R sells for €1 per bag
more than P, even though transport costs have not changed at all.
Should the wholesaler change the orders? And if so, how exactly?

56. The air company "Greek Air-transportations" uses four types of aircrafts (Β727, Β737, Β707,
Α300) and aims to use them in four new routes of transportation of the fresh agricultural
products:
 ΕΑ 101: Athens - Bucharest
ΕΑ 108: Athens - Glasgow
ΕΑ 205: Thessaloniki - Laussane
ΕΑ 207: Thessaloniki - Hamburg

The weekly demand of the products is calculated to 400 tons for Bucharest, to 530 for Glasgow,
to 450 for Laussane and to 480 for Hamburg. The offering transportation ability for the same
time period is 420 tons with Β 727, 390 tons with Β 737, 480 tons with Β 707 and 570 tons with
Α 300 (without the number of the aircrafts or the routes getting examined).
The Β 737 cannot be used to the route Athens - Glasgow due to restricted action radius (a
medium supply is disadvantageous) while the Α 300 can’t fly to Bucharest, because there is not
specialized technical land potential. The profit per ton (in €) for each flight-type aircraft
combination is:

Flight ΕΑ 101 ΕΑ 108 ΕΑ 205 ΕΑ 207

Aircrafts
Α 300 8 16 13 14
Β 727 9 7 13 12
Β 737 10 10 14 12
Β 707 12 14 13 14

Design the routes so as to maximize the profit.

57. An agricultural partnership has the following orders (in tons) for fresh and canned peaches.

Month May June July August

Product
Fresh 50 120 140 100
Can 45 40 35 55

The collection of one ton of peach requires four working hours, the sorting and packaging for
direct disposition (fresh) six working hours, while the canning of the same quantity requires five
working hours.
The partnership employs totally 10 employees who work on an average for 25 days per month,
where each day has 8 working hours. 5 of them should be moved to other cultivation for 13 days
every month in May and for 16 days in July and in August.
Monthly wages are formed per four-month as follows:

Labor- Month May June July August

Collection 1,000 1,100 950 900
Package 800 850 800 700
Canning 800 800 900 800

Late delivery of an order is not possible. Production that exceeds demand of the same period
reflects a charge against salary of € 50 during the month that production exceeds demand.
Design the most advantageous production to the partnership.
58. A company has decided to produce three new products. Its five branches are currently over
production capacity. The construction cost of one unit of the first product will be $31, $29, $32,
$28 and $29 in 1st, 2nd, 3rd, 4th and 5th branch respectively. Construction cost of a unit of the
second product will be $45, $41, $46, $42 and $43 in 1 st, 2nd, 3rd, 4th and 5th branch respectively.
Construction cost of a unit of the third product will be $38, $35 and $40 in 1 st, 2nd and 3rd branch,
respectively, while the 4th and 5th branch do not have the ability to produce this product. The
sales division is sure that they can sell 6000, 10000 and 8000 units of products 1, 2 and 3
respectively per day. Branches 1, 2, 3, 4 and 5 have the potential to produce 4000, 6000, 4000,
6000 and 10000 units per day, respectively, without including the combination of products
available. It is assumed that whichever branch has the ability and capacity to produce these
products it can also produce combinations of these in any quantity.
The administration wants to know how to allocate new products to the branches in order to
minimize construction costs.
a) Design the problem as a transportation model.
b) Starting with the Vogel method for finding the initial feasible solution, use the MODI
method to determine the optimal solution.

59. A company which produces a unique product has three branches and four main customers. The
three branches will produce 6, 8 and 4 units respectively during the following period. The
company has pledged to sell 4 units to the first client, 6 units to the second client and at least 2
units to the third client. The third and fourth clients want to buy as much as possible of what will
be left over. The net profit from the transportation of a unit from the branch i to customer j is
given in the table below.

Clients 1 2 3 4
Branches
1 6 3 2 4
2 7 5 4 6
3 9 8 6 3

The management wants to know how many units to sell to its interest to the third and fourth
clients and how many units should be transferred from the branches to each of the four clients
in order to maximize the total profit.

60. New designs must be done for the energy systems of a new building. The three possible sources
of energy are electrical, gas and solar energy. The building needs the energy for electricity,
water heating and heating of the interior spaces. The respective daily requirements are:
Electricity : 20 units
Water heating : 10 units
Heating : 30 units

The size of the roof reduces solar modules to 30 points, while there is no restriction for the rest.
The electricity needs can be satisfied by the electricity market ($ 200 unit). The needs of the two
other sources can be met from some source or combination of sources. Prices of units are:
 Electricity Natural gas Solar energy
Water heating $450 $300 $150
Heating $400 $250 $200

(a) Design the problem as a transportation model.

(b) Use the northwest corner method for finding the initial basic possible solution to the
problem as designed at (a).
(c) Starting with the basic feasible solution of (b), use the MODI method to determine the best
solution.
(d) Use Vogel method for finding the initial feasible solution of the problem as designed at (b).
(e) Starting with the initial basic feasible solution of the question (d), use the methodology of
transposition problems to find the optimal solution.
Compare the numbers of steps required to determine the optimal solution using the above two
methods.

61. A company has two branches that produce a specific product distributed in three reception
centers. The production of each unit has the same cost in both branches and the transport cost
(in hundreds of U.S. dollars) per unit for the product is presented for each combination of
branch and reception center in the table below.

Reception center 1 2 3
Branch
Α 4 6 3
Β 6 5 2

A total of 60 units of product are to be produced and transported per week. Each branch can
produce and send any number of units with a maximum of 50 units per week, i.e. there is
flexibility in how they will share the total production between the two branches, in order to
reduce transportation costs.
The objective of the management is to determine how many should be produced at each branch
and then what will be the total mode of transportation to minimize the transportation costs.
Answer the following questions:
(a) Suppose that each reception center must accept 20 units per week. Design the problem as a
transportation model.
(b) Use the northwest corner method to find an initial basic feasible solution of the problem, as
designed in question (a). Then determine the optimal solution.
(c) Suppose now that each distribution center can receive an amount between 10 and 30 units
per week to reduce transportation costs, but the total cargo transported remains at 60
points. Design the problem as a transportation model.
(d) Use the Vogel method to find the initial basic feasible solution for the problem as designed
at (c) and then determine the optimal solution.

62. One of the most important products of a multinational IT company is produced in two of its
factories and is mostly available in three main clients of the firm. The two factories will produce
over the next period 600 and 400 units of the product, respectively. The company is committed
with contracts for the sale of 500 units to the first client and at least 200 units to the second.
Also the second and third clients both want to buy as many of the remaining units of the
 product. The net profit from the sale of each unit depends on its origin (factory) and the
destination (client) and ranges according to the following table:

Client 1 2 3
Factory
1 50,000 70,000 60,000
2 20,000 30,000 50,000

How exactly should the 1000 units of the product be allocated in order to maximize the total
profit?

63. A student, who is studying abroad, decided that he needs a car for his movements for the next
four years. Since his other expenses are high, he wants to carry out his wish in the most
inexpensive way. What he can’t decide is whether to buy an old car or a new one. Also he does
not know whether he should sell it through these four years. The following data are given:

Purchase Cost of car use per year ($) Car purchase price per year ($)
price ($) 1st 2nd 3rd 4th 1st 2nd 3rd 4th
Old car 1,000 1,900 2,200 2,500 2,800 600 400 200 0
New car 3,800 1,000 1,300 1,700 2,300 2,200 1,600 1,200 1,000

If the student changes his car within the next four years, he will do it at the end of the year and
will take a car of one of two types. However, he plans to get in the future a newer of that what
he gets now. He wants to find the most appropriate solution.
a) Describe how the problem can be expressed as a transportation model
b) Find the initial solution using any relevant method.
c) Determine the optimal solution by the MODI method.

64. A large construction company undertook computerization of items to equip a ministry with PC
terminal units. It agreed to supply 150 units next October and 225 units in November. Working
an eight hour shift, the manufacturer can only produce 160 terminal units per month. Extending
working hours with two hours overtime, it is possible to construct 30 additional units per month,
with an additional unit cost of € 20. The terminal units can be stored at a monthly cost of € 3 per
unit. The cost of producing each unit of PC is constant, regardless of the month of construction.
Formulate the model (the initial table) in order to find out the production schedule, which
minimizes the total cost.

65. A company is expected to face in the next four months monthly demands of 95, 120, 110 and
100 units of products. The production capacity is 90 units per month at a cost of €20 per unit in
regular employment. The overtime, which can reach 20% of normal, costs €30 per unit. The
storage cost is €1 per unit and per month, while the cost for late delivery of order is €3. The
company is worried about the high cost of overtime expenses and thinks to make a limited
expansion of its facilities so that the normal capacity to be increased to 99 units in order to
reduce overtime, which seem to overburden the operating costs. The total production capacity
will not be changed. If the company is getting expanded at the beginning of the four months, the
costs will remain the same. If it extends at the beginning of the 3 rd month, then the cost will be
 increased by €1, but according to latest legislative incentives for the extension will
receive a subsidy by the government with €400.
What exactly would you suggest the company to do?

66. The Build-Em-Fast Company has agreed to supply the best customers with three products every
week for three weeks, though the production will require some overtime. The data involved are
the following:

Week Maximum production Maximum production Production cost per unit

(normal period) (overtime) (normal period)
1 2 2 $6,000
2 2 1 $10,000
3 1 2 $8,000

The cost per unit produced in overtime for each week is $ 2000 more than in the regular season.
The storage cost is $ 1000 per unit for each week of storage. There are already two products in
construction, but the administration does not want to have to manufacture products after the
end of the three weeks.
The administration wants to know how many units it should produce per week to maximize its
profit. Find the optimal solution.

67. A company manufactures a type of product in four different production plants: P1, P2, P3 and
P4. Each of these production plants can produce up to 15 tons per month. The company supplies
30, 16 and 14 tons a month to three customers C1, C2 and C3, respectively.
The distances measured in km from each production plant to each customer are displayed
below:

C1 C2 C3
P1 100 100 50
P2 650 110 100
P3 60 65 75
P4 150 90 70

The cost of transporting each ton of product is of 0.5 euros per km. Allocate plants to customers
so as to minimize the company’s transportation cost.

68. A company manufactures a type of product in four different production plants: P1, P2, P3 and
P4. The unit production cost and the production capacity differ from one production plant to
another as shown in the table:

Production plant Production cost Production capacity

P1 15 100
P2 9 85
P3 7 140
P4 13 125
 The units produced are sent to three shops S1, S2 and S3. Each shop has a different demand and
sells the product unit at a different price as shown in the following table:

Shops Price Demand

S1 45 125
S2 33 150
S3 40 175

The product unit transportation costs are shown below:

S1 S2 S3
P1 4 5 3
P2 6 3 4
P3 4 4 3
P4 7 2 3

Formulate the matrix format of the transportation problem considering that the objective is to
maximize.

69. An enterprise manufactures a product in three production plants, P1, P2 and P3, with a
production capacity of 130, 200 and 170 units of product, respectively. The demand of four
customers has to be satisfied as follows: customer C1 demands 150 product units, customer C2
demands 175, and customer C3 demands at least 125. Both customers C3 and C4 are prepared
to buy any spare product units, and they both want to buy as many units of product as possible.
The benefit obtained from the sale of units of product to the customers is the following:

C1 C2 C3 C4
P1 60 40 45 55
P2 70 55 65 60
P3 80 60 55 75

Formulate the matrix format of the transportation problem so as to maximize the total benefit.

70. A production plant aims to schedule production for the next three weeks. Employees work both
on regular-time shifts and on extended shifts. 8 machines must be sold every week. The
following table shows the production capacity for the following three weeks, both working on
regular-time shifts and on extended shifts, and the cost of each working hour.

Week Production capacity Production capacity Working hour cost (euro)

(regular-time shifts) (extended shifts)
1 5 5 20
2 4 5 30
3 2 5 45

The production on extended shifts is more expensive than on regular-time shifts; it costs 10
additional euros. The machines produced and not sold in a week are stored at a holding cost of
15 euros per machine for each extra week that it is stored. There are 2 machines in the
 warehouse at present, which will be used to satisfy the demand of the next weeks. By the end of
the third week, and once the demands have been satisfied, there should not be any machines
left in the warehouse.
Satisfy the machine demands at a minimum cost.

71. Given the following transportation costs table, apply the northwest corner method to find an
initial basic feasible solution. Starting from this, find the optimal solution using MODI method.

D1 D2 D3 D4 Supply
O1 9 11 11 8 400
O2 7 12 14 10 200
O3 11 10 12 16 620
Demand 300 340 400 440

72. Given the following transportation costs table, apply Vogel’s approximation method to find an
initial basic feasible solution. From this, find the optimal solution using MOdified DIstribution
method.

D1 D2 D3 D4 D5 Supply
O1 80 40 60 30 25 30
O2 50 20 40 35 28 30
O3 65 50 30 22 26 30
Demand 10 10 20 20 30

73. Given the following transportation costs table, apply the least cost method to find an initial basic
feasible solution. Improve this solution to achieve optimality.

D1 D2 D3 D4 D5 D6 Supply
O1 30 28 12 15 20 10 80
O2 10 15 12 20 25 10 100
O3 8 10 6 8 8 10 75
O4 20 22 24 20 25 21 120
O5 25 20 30 35 32 28 60
O6 27 30 25 14 20 26 65
Demand 100 100 50 50 100 100

74. Consider the following transportation problem in matrix format. Find an initial basic feasible
solution using VAM, and apply the MODI method to compute the optimal solution.

D1 D2 D3 D4 Supply
O1 20 19 10 15 32
O2 17 15 6 10 23
O3 18 14 2 6 30
O4 21 23 3 6 47
Demand 70 33 22 7
75. Consider the following transportation problem in matrix format. Find an initial basic feasible
solution using matrix minima method, and apply the MODI method to compute the optimal
solution.

D1 D2 D3 D4 Supply
O1 15 23 20 25 30
O2 14 17 11 17 12
O3 14 7 6 10 5
O4 8 9 10 5 10
Demand 20 4 10 31

76. Consider the following transportation problem in matrix format. Find an initial basic feasible
solution using matrix minima method, and apply the MODI method to compute the optimal
solution.

D1 D2 D3 D4 D5 Supply
O1 5 2 3 8 10 10
O2 7 5 4 5 8 12
O3 6 3 7 5 9 12
Demand 4 5 7 9 9

77. Consider the following transportation problem in matrix format. Find an initial basic feasible
solution using North-West Corner Rule, and apply the MODI method to compute the optimal
solution.

D1 D2 D3 D4 D5 Supply
O1 15 14 9 16 11 4
O2 10 15 8 14 11 6
O3 13 10 13 15 − 9
Demand 3 4 7 4 6

78. Consider the following transportation problem in matrix format. Find an initial basic feasible
solution using Vogel’s approximation method, and apply the MODI method to compute the
optimal solution.

D1 D2 D3 D4 D5 Supply
O1 32 30 27 26 25 42
O2 28 25 22 22 19 40
O3 35 36 29 38 25 48
O4 20 22 15 17 16 10
Demand 18 50 8 52 12

79. Consider the following transportation problem in matrix format. Find an initial basic feasible
solution using Vogel’s approximation method, and apply the MODI method to compute the
optimal solution.

D1 D2 D3 D4 Supply
 O1 20 10 5 15 20
O2 12 8 10 9 5
O3 11 15 8 9 12
O4 15 7 15 6 2
O5 10 20 15 10 6
Demand 15 15 5 5

80. Consider that a company transports desktop computers from three warehouses to three retail
stores. The number of computers available (supply) in the three warehouses are 40, 50 and 30
while the number of computers required at the three retailers (demand) are 20, 35 and 65
respectively. The cost to transport one unit from a given warehouse to a given retailer is given in
the table below.

Warehouses W1 W2 W3
Retailers
R1 9 6 10
R2 10 8 9
R3 5 4 7

How do we transport the computers such that we incur minimum total cost of the
transportation?

81. A company that sells TV sets has two warehouses and three four retail outlets. They have to
transport 40, 50, and 20 TV sets to the four retailers. The warehouses have 65 and 45 sets. The
unit cost of transportation from i to j is given in the table below:

R1 R2 R3
W1 15 20 22
W2 9 18 14

Find the least cost transportation plan?

82. Consider the problem of transporting TV sets of a particular brand from 2 warehouses to 3 retail
shops. The demand in the three retailers is 80, 60 and 90 while 100 and 120 sets are available in
the two warehouses. The cost of transportation is defined as a unit cost of transporting an item
from a warehouse to retailer and these are given in the table below. Find the optimum solution
with least total cost of transportation?

4 6 5 100
5 7 8 150
80 60 90

83. A company has four factories where cars are made and these are sold in three retail outlets. The
cost of making the car in factory i is 4, 4.5, 3.8 and 4.2. The cost of transporting the car from
factory i to retailer j is given in Table 2.12. The supplies in the warehouses are 200, 160, 180 and
150. The demands are 210, 230 and 200. The cars are sold at 6, 7 and 6.5 in the three retail
centres. It is not possible to transport from factory 3 to retailer 1 due to security reasons. Find
 the transportation quantities that maximize the total profit? What happens to the solution if the
demand increases by 50 in all the retailers?

R1 R2 R3
F1 0.3 0.4 0.2
F2 0.15 0.25 0.22
F3 xxx 0.16 0.19
F4 0.07 0.09 0.1

84. A company called Arizona Plumbing, which makes, among other products, a full line of bathtubs.
The firm must decide which of its factories should supply which of its warehouses. Relevant data
for Arizona Plumbing are presented in the table below:

TO ALBUQUERQUE BOSTON CLEVELAND Factory

FROM Capacity
Des Moines $5 $4 $3 100
Evansville $8 $4 $3 300
Fort Lauderdale $9 $7 $5 300
Warehouse 300 200 200
Requirement

Find the optimal solution that minimizes the total transportation cost. Compute the optimal
cost.

85. In Problem 84, let’s assume that Arizona Plumbing increases the production in its Des Moines
factory to 250 bathtubs. Reformulate and solve the problem.

86. Martin Shipping Company has three warehouses from which it supplies its three major retail
customers in San Jose. Martin’s shipping costs, warehouse supplies, and customer demands are
presented in the transportation table below:

TO Customer 1 Customer 2 Customer 3 Warehouse

FROM Supply
Warehouse 1 $8 $2 $6 100
Warehouse 2 $10 $9 $9 120
Warehouse 3 $9 $7 $5 80
Customer 100 100 100
Demand

Find the allocation that minimizes the total transportation cost. Compute the optimal cost.