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Transportation modelIn the obvious sense, the model deals with the determination of a minimum cost plan for transporting a single commodity from a number of sources (e.g. factories) to a number of destinations (example, warehouses).
The model can be extended in a direct manner to cover practical situations in the area of inventory control, employment arrangement, personnel assignment, cash flow, preparing, dam reservoir levels, and many others. The model also can be modified to account for multiple commodities. It is basically a LP that can be solved by the simplex method. Though, its special structure allows the development of a solution procedure called the transportation technique that is computationally more efficient. It must be emphasized that the "new" technique essentially follows the exact steps of the simplex method. It can be extended to cover a number of important applications, including the assignment model, the transhipment model. However, the transportation model and its extensions are also special cases of network models.
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The following information pertains to Fairways Driving Range, Inc.: The company is considering operating a new driving range facility in Sanford, FL. In order to do so, they will
x+2y+3z=6 2x+4y+z=7 3x+2y+9z=14
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Suppose the spot price for Euro is $1.30, the futures price for delivery in 6 months is $ 1.29675. Assume that the 6 month borrowing/lending rate in Euro is 1.5 percent (annually,
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