course : applied management science

D E C A F B Problem 4. Noble Amazon sells books online. Management is trying to determine the best sites for the company's warehouses. The five potential sites under consideration are listed in the first column of the following table. Most of the sales come from customers in the United States. The average weekly demand from each region of the country, the average shipping cost from each warehouse site to each region of the country, the fixed cost per week of each warehouse if it is operated, and the maximum capacity of each warehouse (if it is operated) are shown in the following table. Warehouse Site $6.00 1 2 3 14 15 16 17 18 19 20 21 22 Spokane, WA Reno, NV Omaha, NE Harrisburg, PA Jacksonville, FL Weekly Demand Northwest $2.40 $3.25 $4.05 $5.25 $6.95 8,000 Average Shipping Cost ($/book) Fixed Cost Southwest Midwest Southeast Northeast (per week) $3.50 $4.80 $6.80 $5.75 $40,000 $2.30 $3,40 $5.25 $30,000 $3.25 $2.85 $4.30 $4.75 $25,000 $6.05 $4.30 $3.20 $2.75 $40,000 $5.85 $4.80 $2.10 $3.50 $30,000 12,000 9,000 14,000 17,000 Warehouse Capacity (books/week) 20,000 20,000 15,000 25,000 15,000 Requirement: Formulate and solve a mixed BIP model in a spreadsheet to determine which warehouse sites Noble Amazon should operate and how books should be distributed from each warehouse to each region of the country to minimize total cost. 23 Make sure that formulas, Solver parameters, Sensitivity Reports and Solver Table Results are saved in this worksheet. 24 25 26