Use the table below to answer the following questions).
The Riviera Transport Company RTC) produces car accessories at two plants: Dallas and Atlanta. They ship them to major distribution centers in Houston, San Jose, Jacksonville, and Memphis. The accounting, production, and marketing departments have provided the information in the table below, which shows the unit cost of shipping between any plant and distribution center, plant capacities over the next planning period, and distribution center demands. RTC's supply chain manager faces the problem of determining how much to ship between each plant and distribution center to minimize the total transportation cost, not exceed available capacity, and meet customer demand.
Assume Xij = amount shipped from plant i to distribution center j, where i = 1 represents Dallas, i = 2 represents Atlanta, j = 1 represents Houston, and so on. $$\begin{array} { | l | l | l | l | l | l | }
\hline \text { Transportation } & & & & & \
\text { Model } & & & & & \
\hline & & & & & \
\hline \text { Data } & & & & & \
\hline & \text { Distribution } & & & & \
& \text { Center } & & & & \
\hline \text { Plant } & \text { Houston } & \text { Sarn Jose } & \text { Jacksorville } & \text { Mernphis } & \text { Capacity } \
\hline \text { Dallas } &13.00 & 15.25 & 10.99 & 18.48 & 1250 \
\hline \text { Atlarita } & 10.75 & 15.16 & 9.65 & 18.50 & 750 \
\hline \text { Dernand } & 175 & 325 & 480 & 950 & \
\hline
\end{array}$$ Answer the following questions) using a linear optimization model.
-According to the Sensitivity report on the model, by what price should the unit cost of shipment reduce to make shipment from Dallas to Houston feasible?
A) $8.68
B) $2.16
C) $10.84
D) $3.41

Question

Use the table below to answer the following questions).
The Riviera Transport Company RTC) produces car accessories at two plants: Dallas and Atlanta. They ship them to major distribution centers in Houston, San Jose, Jacksonville, and Memphis. The accounting, production, and marketing departments have provided the information in the table below, which shows the unit cost of shipping between any plant and distribution center, plant capacities over the next planning period, and distribution center demands. RTC's supply chain manager faces the problem of determining how much to ship between each plant and distribution center to minimize the total transportation cost, not exceed available capacity, and meet customer demand.
Assume Xij = amount shipped from plant i to distribution center j, where i = 1 represents Dallas, i = 2 represents Atlanta, j = 1 represents Houston, and so on. $$\begin{array} { | l | l | l | l | l | l | } 
\hline \text { Transportation } & & & & & \
\text { Model } & & & & & \
\hline & & & & & \
\hline \text { Data } & & & & & \
\hline & \text { Distribution } & & & & \
& \text { Center } & & & & \
\hline \text { Plant } & \text { Houston } & \text { Sarn Jose } & \text { Jacksorville } & \text { Mernphis } & \text { Capacity } \
\hline \text { Dallas } &13.00 & 15.25 & 10.99 & 18.48 & 1250 \
\hline \text { Atlarita } &  10.75 & 15.16 & 9.65 & 18.50 & 750 \
\hline \text { Dernand } & 175 & 325 & 480 & 950 & \
\hline
\end{array}$$ Answer the following questions) using a linear optimization model.
-According to the Sensitivity report on the model, by what price should the unit cost of shipment reduce to make shipment from Dallas to Houston feasible?
A) $8.68
B) $2.16
C) $10.84
D) $3.41

Quizplus · Accepted Answer

The unit cost of shipment from Dallas to Houston needs to reduce by $2.16 to make it feasible because this is the difference in unit cost between the cheapest route (Atlanta to Houston at $10.75) and the Dallas to Houston route at $13.00. Reducing Dallas to Houston by $2.25 would match the lowest cost, making it a feasible option for optimization.

Use the Table Below to Answer the Following Questions) Answer the Following Questions) Using a Linear Optimization Model