Opportunity costs of cells - transportation problem, Operation Management

Having determined all ui and vj values calculate for each unoccupied cell ij = ui + vj - cij. The ij represent the opportunity costs of various cells. After obtaining the opportunity costs process in the same way as in the stepping stone method. If all the empty cells have negative opportunity costs, the solution is optimal and unique. If some empty cells has a zero opportunity cost but if non of the other empty cells have positive opportunity cost then it implies that the given solution is optimal but that it is not unique there exists other solution that would as good as this solution.

However if the solution contains a positive opportunity cost for one or more of the empty cells the solution is not optimal. In such a case the cell with the largest opportunity cost value is selected a closed loop traced and transfers of unit along the route are made in accordance with the method discussed earlier. Then the resulting solution is again tested for optimality and improved if necessary. The process is repeated until an optimal solution is obtained.

Posted Date: 4/5/2013 2:23:50 AM | Location : United States







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