A student about to enter college away from home has decided that she will need an automobile during the next four years. Since funds are going to be very limited, she wants to do this in the cheapest possible way. However, considering both the initial purchase price and the operating maintenance costs, it is not clear whether she should purchase a very old car or just a moderately old car. Furthermore, it is not clear whether she should plan to trade in her car at least once during the four years, before the costs become to high.
If the student trades in a car during the next four years, she would do it at the end of a year (during the summer) on another car of one of these two kinds. She definitely plans to trade in her car at the end of the four years on a much newer model. However, she needs to determine which plan for purchasing and (perhaps) trading in cars during the four years would minimize the total net cost for the four years.
(a) Describe how this problem can be fitted into the format of the transshipment problem.
(b) Reformulate this problem as an equivalent transportation problem by constructing the appropriate parameter table.

  • CreatedSeptember 22, 2015
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