Question:

A company sells seven types of boxes, ranging in volume from 17

to 33 cubic feet. The demand and size of each box is given in Table
7. The variable cost (in dollars) of producing each box is equal to
the box’s volume. A fixed cost of $1,000 is incurred to produce
any of a particular box. If the company desires, demand for a box
may be satisfied by a box of larger size. Formulate and solve a
shortest-path problem whose solution will minimize the cost of
meeting the demand for boxes.

TABLE 7

 Box

 1 2 3 4 5 6 7

Size 33 30 26 24 19 18 17

Demand 400 300 500 700 200 400 200

Answer :

The network will have seven nodes (1, 2, 3, 4, 5, 6, 7 and 8). Let,

The cost of meeting the demand for boxes beginning of i year

till the beginning of j year. Network for minimizing cost is given
below:

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 Now calculate each by the formula given below:

Hence,

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 Now,

One unit of flow from node i to node j through

Now from shortest-path strategy corresponds to the path

. The length of this path is that
is 52400.

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