Quantitative Business Analysis: Transportation and Assignment

Requirements: Use given list of formulae to solve the questions. Show all workings

Question 1

LIST OF FORMULAE 1. The Economic Order Quantity, 20,0 EOQ = , Q D TC = CH +C. +DC Q 2. Total Inventory Cost (EOQ), 3. Reorder point, ROP = dxL 4. MODI Cost Values, C) = R. +K; 1. =C, -R, -K 5. MODI Improvement Index, Question 6 Ammara Clothing Group owns factories in three locations (A, B and C), which distribute to three boutiques in three cities (X, Y and Z). The following table shows the shipping costs per unit (RM) and the number of supply and demand. Supply IN Factory B C Demand 6 5 8 135 Boutiques Y 7 3 5 170 6 7 170 100 180 200 a) Find the initial solution. (3 marks) b) Determine an optimal solution and the total minimum cost for this problem. (You can continue the calculation from the above tableau) (10 marks) c) Determine the factory with surplus and unit surplus. (2 marks)