In the formulation of this optimization problem, we put in a constraint that limits the number of warehouses to P. If we did not have this in the model, why, in general, would the optimization choose to open and use every potential warehouse? Why is it likely to be a bad decision to open and use every potential warehouse (even though this minimizes the transportation costs to the customers)?
Answer to relevant QuestionsIn the formulation of the optimization problem, we are assuming that a customer receives many shipments per year. Assume that we are working on a model for a company that makes 25,000 shipments per year. If we model each ...Consider a consumer packaged goods company that sells their products to supermarkets. For the bigger supermarket retailers, they ship full truckloads from their warehouses directly to the retailer’s warehouses. For smaller ...Open the file Warehouse Costs by Throughput.xls located on the book web site. This file contains the total cost to operate different warehouses by throughput. Run a regression analysis and estimate the fixed and variable ...In the Illinois Quality Parts case study, we first ran the baseline model with a rate of $2/mile for all lanes. Figure 8.14 shows the output of this scenario, showing total cost and total miles traveled out of each ...What is the value if all plants could make all four products? How much better of a solution could you derive?
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