OPM 330-Quantitative Methods For Business

Question:

A company is planning to ship goods from its headquarters in Riyadh to a customer in Dammam. The cost (including time and shipping costs) from one location to another is as follows: A (1,2) $70, B (1,5) $120, C (1,3) $30, D (2,4) $50, E (3,4) $20, F (3,5) $80, G (4,5) $40, H (3,6) $110, I (2,6) $90, J (5,6) $20 and K (4,6) $80

a. Add the route letter (A, B, …, K) and cost (in dollars) in the above network representation. Distinguish arc types by adding small end arrows to one-way arcs.

b. State the objective function (assuming that xij = 1, if the arc from node i to node j is on the shortest route and xij = 0, otherwise; for all i,j).

c. Define all constraints.