![]() Total Cost equals the sumproduct of UnitCost and Shipments. Range NameĮxplanation: The SUM functions calculate the total shipped from each factory (Total Out) to each customer (Total In). ![]() To make the model easier to understand, create the following named ranges. ![]() What is the overall measure of performance for these decisions? The overall measure of performance is the total cost of the shipments, so the objective is to minimize this quantity.Ģ. What are the constraints on these decisions? Each factory has a fixed supply and each customer has a fixed demand.Ĭ. What are the decisions to be made? For this problem, we need Excel to find out how many units to ship from each factory to each customer.ī. To formulate this transportation problem, answer the following three questions.Ī.
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