A company will be producing the same new product at two different factories, and

Question

A company will be producing the same new product at two different factories, and then the product must be shipped to two warehouses. Factory 1 can send an unlimited amount by rail to warehouse 1 only, whereas factory 2 can send an unlimited amount by rail to warehouse 2 only. However, independent truckers can be used to ship up to 50 units from each factory to a distribution center, from which up to 50 units can be shipped to each warehouse. The shipping cost per unit for each alternative is shown in the following table, along with the amounts to be produced at the factories and the amounts needed at the warehouses.

a)

b)

c)

d)

Unit Shipping Cost To Warehouse Distribution Center 2 Output 80 70 From Factory 1 4 Factory 2 Distribution center Allocation 2 4 60 90

Explanation / Answer

Option A looks like the best representation of situation given in the question.

60 units are subtracted from F1

90 units are subtracted from F2

1st two circles represent above 2 statements

F1 can send infinite products to W1 at the cost of 7 per shipment

F2 can send infinite products to W2 at the cost of 9 per shipment

F1 and F2 can send 50 products to distribution centers 3 and 4 respectively

Distribution center can send 50 products to Warehouse 1 and 2.

A looks the correct network representation.

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