Jefferson Kevin A.

Lerio ME-CE-1
School of Engineering and Architecture (SEA)
Ateneo de Davao University (AdDU)

Problem Set in Integer Programming and Distribution Models

1) If the company is scheduling production for the next quarter, what team should be
assigned to lines W, X, Y, Z in order to minimize direct labor cost. Determine the
minimum monthly direct labor cost. Consider that data given are monthly labor cost
in thousands of pesos. Start by selecting best assignment in each column. Use 2
method, namely: Branch and Bound Algorithm and the Assignment Problem
Algorithm.

Production Line
Teams W X Y_ Z

A 150 90 120 110

B 130 140 150 100
C 100 80 110 120
D 120 100 140 130

SOLUTION:

BRANCH AND BOUND METHOD:

AW=150 BZ=100 CX=80 DX=100 INFEASIBLE

430
DROP
AY=120 BZ=100 CW=100DX=100

LB=420
AW AX=90 BW=130 CX=80 DX=100
INFEASIBLE UB=430
AX=90 BZ=100 CX=80 DX=100 400 AY
BW DROP
AX=90 BY=150 CW=100 DX=100
INFEASIBLE

AX=90 BZ=100 CW=100 DX=100 BY 440

INFEASIBLE
CW DROP
LB=370
UB=---
AX=90 BZ=100 CW=100 DY=140
DY
DW 430
LB=390 DROP
UB=400

AX=90 BZ=100 CX=80 DW=120 INFEASIBLE

LB=390
UB=400
ASSIGNMENT PROBLEM ALGORITHM: A 150 90 120 110
1. Select the minimum value per row: B 130 140 150 100

W X Y Z C 100 80 110 120

 D 120 100 140 130

6. Since the number of zeroes (green) is

2. Subtract the minimum value to the same equivalent to the number of rows,
row: therefore, the assignment for each team
would be the following:
W X Y Z
A 60 0 30 20 TEAM PRODUCTION LINE ASSIGNED

B 30 40 50 0 A Y
C 20 0 30 40 B Z
D 20 0 40 30
C W

D X

The total minimized direct labor cost for both

3. Select the minimum value per column:
solutions would be Php 420,000.
W X Y Z
A 60 0 30 20
B 30 40 50 0
C 20 0 30 40
D 20 0 40 30

4. Subtract the minimum value to the same

column:

W X Y Z
A 40 0 0 20
B 10 40 20 0
C 0 0 0 40
D 0 0 10 30

5. Eliminate all values vertically if

it contains zero as a cell value.
W X Y Z
A 40 0 0 20
B 10 40 20 0
C 0 0 0 40
D 0 0 10 30
2) If the real estate broker is selling huge track of properties J, K, & L, and the commission
that the broker stands to earn is shown in the table below in millions of pesos, to which
buyer A, B, or C should the properties be sold? Determine the best feasible selling scheme
(which property to be sold to each buyer) and the optimal commission to be earned. Start the
analysis by selecting best assignment in each row.

PROPERTIES
Buyer J_ K_ L_
A 3.5 3.8 3.2
B 3.6 3.8 2.8
C 3.0 3.3 2.7
AJ=3.5
BL=2.8 9.6 DROP
CK=3.
3
BL

INF AJ=3.5
BK=3.8 10 DROP
INF CL=2.7

AJ=3.5
BK=3.
8
10.6
AJ CK=3. AL=3.2 10.1
INF
AL BJ=3.6
AK=3.8 INF CK=3.
BK=3.8 BJ 3
AK=3.8
CK=3.3
BJ=3.6
CK=3.3 CL
UB=10.9 CJ
LB=--- UB=10.7 10.1
INF LB=10.6 AK=3.8
BJ=3.6
AK=3. 10.6 CL=2.7
8
BK=3. AL
8 AL=3.
2 10 DROP
BK=3.
BL 8

ANSWER: The best buyers for each AK=3.

property would be the following: 8 9.6 DROP
Property L should be bought by Buyer BL=2.8
A Property J should be bought by Buyer CJ=3.0
B Property K should be bought by
Buyer C Or the following could be
also followed to yield the best
commission:
Property K should be bought by
Buyer A Property J should be bought
by Buyer B Property L should be
bought by Buyer C
So that the commission that the real
estate broker will get would be Php 10.1
million.
3) Using NCR to obtain the initial tableau, and the Method of Multiplier to iterate from one
tableau to another until optimality is reached, determine the least cost schedule and the
minimum cost for supply to satisfy demand of tons of corn in a month.
SUPPLY DEMAND Unit Transportation Cost per ton of corn in P(000)

A 1250 W 1850 From To W To X To

Y
B 2350 X 2450 A 30 28 31
C 1350 Y 2000 B 29 35 25
C 22 26 40

Using Northwest Corner Method (NCR):

TO
FROM W X Y SUPPLY

1250
A 1250 30 X 28 X 31
0
2350
B 600 29 1750 35 X 25 1750
0
1350
C X 22 700 26 650 40 650
0
1350
Dummy X 0 X 0 1350 0
0
1850 2450 2000
DEMAND 600 700 1350 6300
0 0 0

TO
FROM W X Y SUPPLY

A 1250 30 28 31 0

B 600 29 1750 35 25 0

C 22 700 26 650 40 0

Dummy 0 0 1350 0 0

DEMAND 0 0 0 6300

Initial Solution:1250(30)+600(29)+1750(35)+700(26)+650(40)+1350(0)=
160350(1000)
160,350,000
Optimization: Methods of Multiplier (MODI)

FIRST ITERATION
V1 V2 V3

29 35 49

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 600 29 1750 35 25 0

U3 -9 C 22 700 26 650 40 0

U4 -49 Dummy 0 0 1350 0 0

DEMAND 0 0 0 6300

Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)

dij cij-(ui+vj)
12 -8
13 -19
23 -24 (minimum value)
31 2
41 20
42 14
 V1 V2 V3

29 35 49

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 600 29 -1750 35 + 25 0

U3 -9 C 22 +700 26 -650 40 0

U4 -49 Dummy 0 0 1350 0 0

DEMAND 0 0 0 6300

V1 V2 V3

29 35 49

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 600 29 1100 35 650 25 0

U3 -9 C 22 1350 26 40 0

U4 -49 Dummy 0 0 1350 0 0

DEMAND 0 0 0 6300

V1 V2 V3

29 35 25

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 600 29 1100 35 650 25 0

U3 -9 C 22 1350 26 40 0

U4 -25 Dummy 0 0 1350 0 0

DEMAND 0 0 0 6300
Find dij for all unoccupied cells(i,j), where d ij=cij-(ui+vj)
dij cij-(ui+vj)
12 -8
13 5
31 2
33 24
41 -4
42 -10

SECOND ITERATION

V1 V2 V3

29 35 25

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 600 29 -1100 35 +650 25 0

U3 -9 C 22 1350 26 40 0

U4 -25 Dummy 0 + 0 -1350 0 0

DEMAND 0 0 0 6300
 V1 V2 V3

29 35 25

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 600 29 35 1750 25 0

U3 -9 C 22 1350 26 40 0

U4 -25 Dummy 0 1100 0 250 0 0

DEMAND 0 0 0 6300

Find new U and V values:

V1 V2 V3

29 25 25

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 600 29 35 1750 25 0

U3 1 C 22 1350 26 40 0

U4 -25 Dummy 0 1100 0 250 0 0

DEMAND 0 0 0 6300

Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)

dij cij-(ui+vj)
12 2
13 5
22 10
31 -8
33 14
41 -4
 THIRD ITERATION

V1 V2 V3

29 25 25

TO
FROM W X Y SUPPLY

U1 1 A 1250 30 28 31 0

U2 0 B 350 29 35 2000 25 0

U3 1 C 250 22 1100 26 40 0

U4 -25 Dummy 0 1350 0 0 0

DEMAND 0 0 0 6300

Find the new values of U and V:

V1 V2 V3

0 4 -4

TO
FROM W X Y SUPPLY

U1 30 A 1250 30 28 31 0

U2 29 B 350 29 35 2000 25 0

U3 22 C 250 22 1100 26 40 0

U4 -4 Dummy 0 1350 0 0 0

DEMAND 0 0 0 6300
Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)
dij cij-(ui+vj)
12 -6
13 5
22 2
33 22
41 4
43 8

FOURTH ITERATION

V1 V2 V3

0 4 -4

TO
FROM W X Y SUPPLY

U1 30 A -1250 30 + 28 31 0

U2 29 B 350 29 35 2000 25 0

U3 22 C +250 22 -1100 26 40 0

U4 -4 Dummy 0 1350 0 0 0

DEMAND 0 0 0 6300
 V1 V2 V3

0 4 -4

TO
FROM W X Y SUPPLY

U1 30 A 150 30 1100 28 31 0

U2 29 B 350 29 35 2000 25 0

U3 22 C 1350 22 26 40 0

U4 -4 Dummy 0 1350 0 0 0

DEMAND 0 0 0 6300

Find the new values of U and V:

V1 V2 V3

0 -2 -4

TO
FROM W X Y SUPPLY

U1 30 A 150 30 1100 28 31 0

U2 29 B 350 29 35 2000 25 0

U3 22 C 1350 22 26 40 0

U4 2 Dummy 0 1350 0 0 0

DEMAND 0 0 0 6300

Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)

dij cij-(ui+vj)
13 5
22 8
32 6
33 22
41 -2
43 2
 FIFTH ITERATION

V1 V2 V3

0 -2 -4

TO
W X Y SUPPLY
FROM

U1 30 A -150 30 +1100 28 31 0

U2 29 B 350 29 35 2000 25 0

U3 22 C 1350 22 26 40 0

U4 2 Dummy + 0 -1350 0 0 0

DEMAND 0 0 0 6300

V1 V2 V3

0 -2 -4

TO
FROM W X Y SUPPLY

U1 30 A 30 1250 28 31 0

U2 29 B 350 29 35 2000 25 0

U3 22 C 1350 22 26 40 0

U4 2 Dummy 150 0 1200 0 0 0

DEMAND 0 0 0 6300
 Find the new U and V values:

V1 V2 V3

0 0 -4

TO
FROM W X Y SUPPLY

U1 30 A 30 1250 28 31 0

U2 29 B 350 29 35 2000 25 0

U3 22 C 1350 22 26 40 0

U4 0 Dummy 150 0 1200 0 0 0

DEMAND 0 0 0 6300

Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)

dij cij-(ui+vj)
11 2
13 7
22 6
32 4
33 22
43 4

No values of cij-(ui+vj)<0, therefore the optimal solution for this problem would be:

TO
FROM W X Y SUPPLY

A 30 1250 28 31 0

B 350 29 35 2000 25 0

C 1350 22 26 40 0

Dummy 150 0 1200 0 0 0

DEMAND 0 0 0 6300

The minimum total transportation cost

=28×1250+29×350+25×2000+22×1350+0×150+0×1200=
=124850(1000)
=124,850,000
4) Using the Northwest Corner Rule to obtain the initial tableau, and the Method of Multiplier
to iterate from one tableau to another until optimality is reached, determine the least cost
schedule and the minimum cost for supply to satisfy demand of tons of malt in a week.
Then for the same problem, use the Vogel’s Approximation Method and the Method of Multiplier
to determine the optimal schedule arriving at the same minimum cost.

SUPPLY DEMAND Unit Transportation Cost per ton of corn in P(000)

A 450 W 850 From To W To X To
Y
B 550 X 350 A 50 30 40
C 650 Y 250 B 30 44 25
C 20 55 45
Using Northwest Corner Rule:
TO
FROM W X Y Dummy SUPPLY

450
A 450 50 X 30 X 40 X 0
0
550
B 400 30 150 44 X 25 X 0 150
0
650
450
C X 20 200 55 250 45 200 0
200
0
850 350
250 200
DEMAND 400 200 1650
0 0
0 0

TO
FROM W X Y Dummy SUPPLY

A 450 50 30 40 0 0

B 400 30 150 44 25 0 0

C 20 200 55 250 45 200 0 0

DEMAND 0 0 0 0 1650

Initial Solution: 50×450+30×400+44×150+55×200+45×250+0×200=63350(1000) =63,350,000

Optimization: Methods of Multiplier (MODI)
FIRST ITERATION
V1 V2 V3 V4
41 55 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 9 A 450 50 30 40 0 0
U2 -11 B 400 30 150 44 25 0 0
U3 0 C 20 200 55 250 45 200 0 0
DEMAND 0 0 0 0 1650

2. Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)

1.d12=c12-(u1+v2)=30-(9+55)=-34

2.d13=c13-(u1+v3)=40-(9+45)=-14

3.d14=c14-(u1+v4)=0-(9+0)=-9

4.d23=c23-(u2+v3)=25-(-11+45)=-9

5.d24=c24-(u2+v4)=0-(-11+0)=11

6.d31=c31-(u3+v1)=20-(0+41)=-21

V1 V2 V3 V4
41 55 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 9 A -450 50 + 30 40 0 0
U2 -11 B +400 30 -150 44 25 0 0
U3 0 C 20 200 55 250 45 200 0 0
DEMAND 0 0 0 0 1650
 V1 V2 V3 V4
41 55 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 9 A 300 50 150 30 40 0 0
U2 -11 B 550 30 44 25 0 0
U3 0 C 20 200 55 250 45 200 0 0
DEMAND 0 0 0 0 1650

Find new U and V values:

V1 V2 V3 V4
75 55 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 -25 A 300 50 150 30 40 0 0
U2 -45 B 550 30 44 25 0 0
U3 0 C 20 200 55 250 45 200 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-

(ui+vj) 1.d13=c13-(u1+v3)=40-(-25+45)=20

2.d14=c14-(u1+v4)=0-(-25+0)=25

3.d22=c22-(u2+v2)=44-(-45+55)=34

4.d23=c23-(u2+v3)=25-(-45+45)=25

5.d24=c24-(u2+v4)=0-(-45+0)=45

6.d31=c31-(u3+v1)=20-(0+75)=-55
 SECOND ITERATION
V1 V2 V3 V4
75 55 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 -25 A -300 50 +150 30 40 0 0
U2 -45 B 550 30 44 25 0 0
U3 0 C + 20 -200 55 250 45 200 0 0
DEMAND 0 0 0 0 1650

V1 V2 V3 V4
75 55 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 -25 A 100 50 350 30 40 0 0
U2 -45 B 550 30 44 25 0 0
U3 0 C 200 20 55 250 45 200 0 0
DEMAND 0 0 0 0 1650

Find new U and V Values:

V1 V2 V3 V4
20 0 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 30 A 100 50 350 30 40 0 0
U2 10 B 550 30 44 25 0 0
U3 0 C 200 20 55 250 45 200 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)

1.d13=c13-(u1+v3)=40-(30+45)=-35

2.d14=c14-(u1+v4)=0-(30+0)=-30

3.d22=c22-(u2+v2)=44-(10+0)=34

4.d23=c23-(u2+v3)=25-(10+45)=-30
5.d24=c24-(u2+v4)=0-(10+0)=-10

6.d32=c32-(u3+v2)=55-(0+0)=55
THIRD ITERATION
V1 V2 V3 V4
20 0 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 30 A -100 50 350 30 + 40 0 0
U2 10 B 550 30 44 25 0 0
U3 0 C +200 20 55 -250 45 200 0 0
DEMAND 0 0 0 0 1650

V1 V2 V3 V4
20 0 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 30 A 50 350 30 100 40 0 0
U2 10 B 550 30 44 25 0 0
U3 0 C 300 20 55 150 45 200 0 0
DEMAND 0 0 0 0 1650

Find the new U and V values:

V1 V2 V3 V4
20 35 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 -5 A 50 350 30 100 40 0 0
U2 10 B 550 30 44 25 0 0
U3 0 C 300 20 55 150 45 200 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-

(ui+vj) 1.d11=c11-(u1+v1)=50-(-5+20)=35

2.d14=c14-(u1+v4)=0-(-5+0)=5
3.d22=c22-(u2+v2)=44-(10+35)=-1

4.d23=c23-(u2+v3)=25-(10+45)=-30

5.d24=c24-(u2+v4)=0-(10+0)=-10

6.d32=c32-(u3+v2)=55-(0+35)=20
FOURTH ITERATION
V1 V2 V3 V4
20 35 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 -5 A 50 350 30 100 40 0 0
U2 10 B -550 30 44 + 25 0 0
U3 0 C +300 20 55 -150 45 200 0 0
DEMAND 0 0 0 0 1650

V1 V2 V3 V4
20 35 45 0
TO
W X Y Dummy SUPPLY
FROM
U1 -5 A 50 350 30 100 40 0 0
U2 10 B 400 30 44 150 25 0 0
U3 0 C 450 20 55 45 200 0 0
DEMAND 0 0 0 0 1650
Find the new U and V values:

V1 V2 V3 V4
45 30 40 25
TO
W X Y Dummy SUPPLY
FROM
U1 0 A 50 350 30 100 40 0 0
U2 -15 B 400 30 44 150 25 0 0
U3 -25 C 450 20 55 45 200 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-

(ui+vj) 1.d11=c11-(u1+v1)=50-(0+45)=5

2.d14=c14-(u1+v4)=0-(0+25)=-25

3.d22=c22-(u2+v2)=44-(-15+30)=29

4.d24=c24-(u2+v4)=0-(-15+25)=-10

5.d32=c32-(u3+v2)=55-(-25+30)=50

6.d33=c33-(u3+v3)=45-(-25+40)=30
FIFTH ITERATION
V1 V2 V3 V4
45 30 40 25
TO
W X Y Dummy SUPPLY
FROM
U1 0 A 50 350 30 -100 40 + 0 0
U2 -15 B -400 30 44 +150 25 0 0
U3 -25 C +450 20 55 45 -200 0 0
DEMAND 0 0 0 0 1650
 V1 V2 V3 V4
45 30 40 25
TO
W X Y Dummy SUPPLY
FROM
U1 0 A 50 350 30 40 100 0 0
U2 -15 B 300 30 44 250 25 0 0
U3 -25 C 550 20 55 45 100 0 0
DEMAND 0 0 0 0 1650

Find the new U and V values:

V1 V2 V3 V4
20 30 15 0
TO
W X Y Dummy SUPPLY
FROM
U1 0 A 50 350 30 40 100 0 0
U2 10 B 300 30 44 250 25 0 0
U3 0 C 550 20 55 45 100 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-

(ui+vj) 1.d11=c11-(u1+v1)=50-(0+20)=30

2.d13=c13-(u1+v3)=40-(0+15)=25

3.d22=c22-(u2+v2)=44-(10+30)=4

4.d24=c24-(u2+v4)=0-(10+0)=-10

5.d32=c32-(u3+v2)=55-(0+30)=25

6.d33=c33-(u3+v3)=45-(0+15)=30
SIXTH ITERATION
 V1 V2 V3 V4
20 30 15 0
TO
W X Y Dummy SUPPLY
FROM
U1 0 A 50 350 30 40 100 0 0
U2 10 B -300 30 44 250 25 + 0 0
U3 0 C +550 20 55 45 -100 0 0
DEMAND 0 0 0 0 1650

Find the new U and V values:

V1 V2 V3 V4
30 30 25 0
TO
W X Y Dummy SUPPLY
FROM
U1 0 A 50 350 30 40 100 0 0
U2 0 B 200 30 44 250 25 100 0 0
U3 -10 C 650 20 55 45 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-(ui+vj)

1.d11=c11-(u1+v1)=50-(0+30)=20

2.d13=c13-(u1+v3)=40-(0+25)=15

3.d22=c22-(u2+v2)=44-(0+30)=14

4.d32=c32-(u3+v2)=55-(-10+30)=35

5.d33=c33-(u3+v3)=45-(-10+25)=30

6.d34=c34-(u3+v4)=0-(-10+0)=10
Since all dij≥0, the final optimized table would be the following:

TO
W X Y Dummy SUPPLY
FROM
A 50 350 30 40 100 0 0
B 200 30 44 250 25 100 0 0
C 650 20 55 45 0 0
DEMAND 0 0 0 0 1650

The minimum total transportation cost

=30×350+0×100+30×200+25×250+0×100+20×650

=35750(1000)

= 35,750,000

Using Vogel’s Approximation Method:

TO
FROM W X Y Dummy SUPPLY

A 50 30 40 0 450

B 30 44 25 0 550

C 20 55 45 0 650

DEMAND 850 350 250 200 1650

TO
FROM W X Y Dummy SUPPLY Row Diff

450
A 50 30 40 200 0 30
250

B 30 44 25 X 0 550 25

C 20 55 45 X 0 650 20

200
DEMAND 850 350 250 1650
0

Column Diff 10 11 15 0
 TO
FROM W X Y Dummy SUPPLY Row Diff

A 50 30 40 200 0 250 10

B 30 44 25 X 0 550 5

650
C 650 20 X 55 X 45 X 0 25
0
850
DEMAND 350 250 0 1650
200

Column Diff 10 14 15

TO
FROM W X Y Dummy SUPPLY Row Diff

A 50 30 40 200 0 250 10

550
B 200 30 44 25 X 0 5
350

C 650 20 X 55 X 45 X 0 0

200
DEMAND 350 250 0 1650
0

Column Diff 20 14 15

TO
FROM W X Y Dummy SUPPLY Row Diff

A X 50 30 40 200 0 250 10

350
B 200 30 44 250 25 X 0 19
100

C 650 20 X 55 X 45 X 0 0

250
DEMAND 0 350 0 1650
0

Column Diff 14 15
 TO
FROM W X Y Dummy SUPPLY Row Diff

A X 50 30 X 40 200 0 250 30

100
B 200 30 100 44 250 25 X 0 44
0

C 650 20 X 55 X 45 X 0 0

350
DEMAND 0 0 0 1650
250

Column Diff 14

TO
FROM W X Y Dummy SUPPLY Row Diff

250
A X 50 250 30 X 40 200 0 30
0

B 200 30 100 44 250 25 X 0 0

C 650 20 X 55 X 45 X 0 0

250
DEMAND 0 0 0 1650
0

Column Diff 30

TO
FROM W X Y Dummy SUPPLY Row Diff

A X 50 250 30 X 40 200 0 0 30

B 200 30 100 44 250 25 X 0 0

C 650 20 X 55 X 45 X 0 0

DEMAND 0 0 0 0 1650

Column Diff 30
 TO
FROM W X Y Dummy SUPPLY

A 50 250 30 40 200 0 0

B 200 30 100 44 250 25 0 0

C 650 20 55 45 0 0

DEMAND 0 0 0 0 1650
 Optimization: Methods of Multiplier (MODI)
FIRST ITERATION
V1 V2 V3 V4
30 44 25 14
TO
W X Y Dummy SUPPLY
FROM
U1 -14 A 50 250 30 40 200 0 0
U2 0 B 200 30 100 44 250 25 0 0
U3 -10 C 650 20 55 45 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-

(ui+vj) 1.d11=c11-(u1+v1)=50-(-14+30)=34

2.d13=c13-(u1+v3)=40-(-14+25)=29

3.d24=c24-(u2+v4)=0-(0+14)=-14

4.d32=c32-(u3+v2)=55-(-10+44)=21

5.d33=c33-(u3+v3)=45-(-10+25)=30

6.d34=c34-(u3+v4)=0-(-10+14)=-4
 V1 V2 V3 V4
30 44 25 14
TO
W X Y Dummy SUPPLY
FROM
U1 -14 A 50 +250 30 40 -200 0 0
U2 0 B 200 30 -100 44 250 25 + 0 0
U3 -10 C 650 20 55 45 0 0
DEMAND 0 0 0 0 1650

V1 V2 V3 V4
30 44 25 14
TO
W X Y Dummy SUPPLY
FROM
U1 -14 A 50 350 30 40 100 0 0
U2 0 B 200 30 44 250 25 100 0 0
U3 -10 C 650 20 55 45 0 0
DEMAND 0 0 0 0 1650

Find new U and V values:

V1 V2 V3 V4
30 30 25 0
TO
W X Y Dummy SUPPLY
FROM
U1 0 A 50 350 30 40 100 0 0
U2 0 B 200 30 44 250 25 100 0 0
U3 -10 C 650 20 55 45 0 0
DEMAND 0 0 0 0 1650

Find dij for all unoccupied cells(i,j), where dij=cij-

(ui+vj) 1.d11=c11-(u1+v1)=50-(0+30)=20

2.d13=c13-(u1+v3)=40-(0+25)=15

3.d22=c22-(u2+v2)=44-(0+30)=14

4.d32=c32-(u3+v2)=55-(-10+30)=35
5.d33=c33-(u3+v3)=45-(-10+25)=30

6.d34=c34-(u3+v4)=0-(-10+0)=10

Since all dij≥0.

So final optimal solution for this problem would be:

TO
W X Y Dummy SUPPLY
FROM
A 50 350 30 40 100 0 0
B 200 30 44 250 25 100 0 0
C 650 20 55 45 0 0
DEMAND 0 0 0 0 1650

The minimum total transportation cost

=30×350+0×100+30×200+25×250+0×100+20×650
=35750(1000)
=35,750,000
5) SOURCE SUPPLY DESTINATION DEMAND

A 580 X 500
B 620 Y 350
C 400 Z 450

Unit Transportation Cost

TO
From X Y Z

A 100 90 120
B 130 140 150
C 150 80 110

Determine the least cost schedule and the minimum transportation cost of the two
given problems using Vogel’s approximation method in determining the initial
tableau, and the Modified Approach or Method of Multiplier in obtaining
succeeding tableaus.
 TO
FROM W X Y SUPPLY

A 100 90 120 580

B 130 140 150 620

C 150 80 110 400

DEMAND 500 350 450

Using Vogel’s Approximation Method:

TO
FROM W X Y Dummy SUPPLY Row Diff

A 100 90 120 0 580 90

B 130 140 150 0 620 130

C 150 80 110 0 400 80

DEMAND 500 350 450 300 1600

Column Diff 30 10 10 0

TO
FROM W X Y Dummy SUPPLY Row Diff

A 100 90 120 X 0 580 90

620
B 130 140 150 300 0 130
320
C 150 80 110 X 0 400 80
300
DEMAND 500 350 450 1600
0
Column Diff 30 10 10 0
 TO
FROM W X Y Dummy SUPPLY Row Diff

A 100 X 90 120 X 0 580 10

B 130 X 140 150 300 0 320 10

400
C 150 350 80 110 X 0 30
50
350
DEMAND 500 450 0 1600
0
Column Diff 30 10 10

TO
FROM W X Y Dummy SUPPLY Row Diff

A 100 X 90 120 X 0 580 20

B 130 X 140 150 300 0 320 20

50
C X 150 350 80 50 110 X 0 40
0
450
DEMAND 500 0 0 1600
400
Column Diff 30 10

TO
FROM W X Y Dummy SUPPLY Row Diff

580
A 500 100 X 90 120 X 0 20
80
B X 130 X 140 150 300 0 320 20

C X 150 350 80 50 110 X 0 0

500
DEMAND 0 400 0 1600
0
Column Diff 30 30
 TO
FROM W X Y Dummy SUPPLY Row Diff

A 500 100 X 90 120 X 0 80 120

320
B X 130 X 140 320 150 300 0 150
0
C X 150 350 80 50 110 X 0 0
400
DEMAND 0 0 0 1600
80
Column Diff 30

TO
FROM W X Y Dummy SUPPLY Row Diff

80
A 500 100 X 90 80 120 X 0 120
0
B X 130 X 140 320 150 300 0 0

C X 150 350 80 50 110 X 0 0

80
DEMAND 0 0 0 1600
0
Column Diff 120

TO
FROM W X Y Dummy SUPPLY Row Diff

A 500 100 X 90 80 120 X 0 0

B X 130 X 140 320 150 300 0 0

C X 150 350 80 50 110 X 0 0

DEMAND 0 0 0 0 1600

Column Diff
Initial Tableau:

TO
FROM W X Y Dummy SUPPLY

A 500 100 90 80 120 0 0

B 130 140 320 150 300 0 0

C 150 350 80 50 110 0 0

DEMAND 0 0 0 0 1600

The initial minimum total transportation cost:

=100×500+120×80+150×320+0×300+80×350+110×50=141100

Optimization: Methods of Multiplier (MODI)

V1 V2 V3 V4
-20 -30 0 -150
TO
W X Y Dummy SUPPLY
FROM
U1 120 10
A 500 90 80 120 0 0
0
U2 150 13 14
B 320 150 300 0 0
0 0
U3 110 15
C 350 80 50 110 0 0
0
DEMAND 0 0 0 0 1600

Find dij for all unoccupied cells(i,j), where dij=cij-

(ui+vj) 1.d12=c12-(u1+v2)=90-(120-30)=0

2.d14=c14-(u1+v4)=0-(120-150)=30

3.d21=c21-(u2+v1)=130-(150-20)=0

4.d22=c22-(u2+v2)=140-(150-30)=20

5.d31=c31-(u3+v1)=150-(110-20)=60

6.d34=c34-(u3+v4)=0-(110-150)=40
 Since all dij≥0, the optimal solution for this problem is:

TO
FROM W X Y Dummy SUPPLY

A 500 100 90 80 120 0 0

B 130 140 320 150 300 0 0

C 150 350 80 50 110 0 0

DEMAND 0 0 0 0 1600

The minimum total transportation cost

=100×500+120×80+150×320+0×300+80×350+110×50

=141100

6) Mindanao Computers is looking for potential sites for their warehouses. The
expected construction time is 2 years and the available funds are P50M the first
year and P36M the second year. The projected costs and returns (all in present
values) are shown in the table below for four potential locations. The company
wishes to maximize the projected return value. Formulate as an integer
programming model using the 0-1 variable. Hint: Each Site is independent of other
sites. Projected Cost for Year 1 affects only the projected cost for Year 2 of THE
SAME SITE.)

Projected Cost
Site Year 1 Year 2 Projected
Returns
A P12M P15M 100
B 20 31 160
C 17 30 150
D 32 15 155
Solution:
Let

d = 0 consider the site

d = 1 do not consider the site
Since the sites are independent from each other, the maximization statements
would be as follows:
Maxyear 1=12dA + 20 dB + 17dC +

32dD Maxyear 2=15dA + 31 dB +

30dC + 15dD d=0,1
The statements above should be solved simultaneously into two parts:
1.) Year 1- 50M
2.) Year 2- 36M
Expressed as:
Constraints(x)
:
Xyear 1A ≤ 50 Xyear 2A ≤ 36

Xyear 1B ≤ 50 Xyear 2B ≤ 36

Xyear 1C ≤ 50 Xyear 2C ≤ 36

Xyear 1D ≤ 50 Xyear 2D ≤ 36
Find: Site with Maximum Projected Return per year.

YEAR 1 SITES
A B C D
Projected Costs 12 20 17 32
1 0 0 0
0 1 0 0
TEST (per site only)
0 0 1 0
0 0 0 1
Maximum allocation vs.
Projected Costs 4.16667 2.5 2.94118 1.5625
(50M/Projected Costs)
Extract the integer value: 4 2 2 1
Multiply the previous
value to Projected 400 320 300 155
Returns

YEAR 2 SITES
A B C D
Projected Costs 15 31 30 15
1 0 0 0
0 1 0 0
TEST (per site only)
0 0 1 0
0 0 0 1
Maximum allocation vs.
Projected Costs 2.4 1.16129 1.2 2.4
(36M/Projected Costs)
Extract the integer value: 2 1 1 2
Multiply the previous
value to Projected 200 160 150 310
Returns
7) Determine the least cost schedule of assigning each job to a machine on a one-to-
one assignment scheme. Solve the problem using 2 methods, namely: branch and
bound method and the assignment algorithm, starting with looking for cheapest
assignment for each row.

HO U R L Y RAT E
JOB Machine M Machine N Machine P

A 60 70 50
B 80 50 60
C 100 80 50

Solution:

Branch and Bound Method:

Assignment Problem Method:

M N P

A 60 70 50

B 80 50 60

C 100 80 50

M N P

A 10 20 0

B 30 0 10

C 50 30 0

M N P

A 10 20 0

B 30 0 10

C 50 30 0

M N P

A 0 20 0

B 20 0 10

C 40 30 0

ANSWER: For both methods, to determine the least cost schedule of assigning each job to a
machine on a one-to-one assignment scheme, the assignment should be as follows:

Machines and its

hourly rates Hourly Rate Total
(Least)
Job M N P

A ✔

B ✔ 160

C ✔