Pedrina, Thalia Nicole N.

2BSA-4

Assignment Nos. 2 Transportation Method

Please answer the following questions and submit on the deadline date.

1. What is transportation problems?

The transportation problem is a special type of linear programming problem where

the objective consists in minimizing transportation cost of a given commodity from
a number of sources or origins (e.g. factory, manufacturing facility) to a number
of destinations (e.g. warehouse, store). Because of its special structure the usual
simplex method is not suitable for solving transportation problems. These
problems require a special method of solution. The origin of a transportation
problem is the location from which shipments are despatched. The destination of
a transportation problem is the location to which shipments are transported.
The unit transportation cost is the cost of transporting one unit of the consignment
from an origin to a destination.

2. What is UV/MODI?

MODI method is an improvement over stepping stone method. This model

studies the minimization of the cost of transporting a commodity from a number
of sources to several destinations. The supply at each source and the demand at
each destination are known.

3. What is LCC?

The Least Cost Cell Method is another method used to obtain the initial feasible
solution for the transportation problem. Here, the allocation begins with the cell
which has the minimum cost. The lower cost cells are chosen over the higher-cost
cell with the objective to have the least cost of transportation

4. What is NCC?

NCC or the northwest corner cell method is a pretty straight forward method, you
just start with extreme upper left corner in order to compute the initial
feasible solution for the transportation problem.
5. What is VAM?

The Vogel’s Approximation Method or VAM is an iterative procedure calculated to

find out the initial feasible solution of the transportation problem. Like Least cost
Method, here also the shipping cost is taken into consideration, but in a relative
sense.

6. Differentiate each method.

THE NCC, LCC, and VAM are the most well-known methods for achieving an initial
feasible solution to the transportation problem. The NCC allocates as much as
possible to the selected cell and adjusts the associated amounts of supply and
demand by subtracting the assigned amount. LCC is also a useful option for
determining the initial feasible solution since it begins with the cheapest or least
cost route, and VAM is the best of the three because it is an upgraded version of
the LCC that generally produces better starting solutions because it accounts for
all costs associated with each alternative route in order to discover the most
optimal solution, as opposed to LCC, which focuses just on least.