Question: A firm has established a distribution network for the supply of a raw material critical to its manufacturing. Currently there are two origins for this
A firm has established a distribution network for the supply of a raw material critical to its manufacturing. Currently there are two origins for this raw material, which must be shipped to three manufacturing plants. The current network has the following characteristics:
| Dest. 1 | Dest. 2 | Dest. 3 | SUPPLY |
Raw Material Source 1 | 6 | 8 | 9 | 300 |
Raw Material Source 2 | 4 | 7 | 3 | 700 |
DEMAND | 500 | 500 | 500 | 1500\1500 |
The firm has identified five potential sites for a third raw material source:
Costs | Dest. 1 | Dest. 2 | Dest. 3 |
Candidate A | 7 | 15 | 6 |
Candidate B | 12 | 12 | 5 |
Candidate C | 13 | 4 | 10 |
Candidate D | 12 | 8 | 8 |
Candidate E | 6 | 10 | 11 |
The new source, wherever it is located, will have a capacity of 500 units. Solve with the transportation method. Which site should be selected?
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