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NETWORK OPTIMIZATION PROBLEMS

1.

times the number of miles involved, where the distance (in miles) between every
pair of offices is as follows:

The diagram below depicts a system of aqueducts that originate at three rivers
(nodes R1, R2, and R3) and terminate at a major city (node T), where the other
nodes are junction points in the system. Using units of thousands of acre feet, the
following tables show the maximum amount of water that can be pumped
through each aqueduct per day.

Management wishes to determine which pairs of offices should be directly


connected by special phone lines in order to connect every branch office (directly
or indirectly) to the main office at a minimum total cost.
a.
b.

3.

The city water manager wants to determine a flow plan that will maximize the
flow of water to the city.
a.

b.

2.

Describe how this problem fits the network description of the minimum
spanning tree problem.
How should the connection be done?

You need to take a trip by car to another town that you have never visited before.
Therefore, you are studying a map to determine the shortest route to your
destination. Depending on which route you choose, there are five other towns
(call them A, B, C, D, E) that you might pass through on the way. The map shows
the mileage along each road that directly connects two towns without any
intervening towns. These numbers are summarized in the following table, where
a dash indicates that there is no road directly connecting these two towns
without going through any other towns.

Formulate this problem as a maximum flow problem by identifying a source,


a sink, and the transshipment nodes, and then drawing the complete
network that shows the capacity of each arc.
Determine the maximum flow of water to the city.

The Premiere Bank soon will be hooking up computer terminals at each of its
branch offices to the computer at its main office using special phone lines with
telecommunications devices. The phone line from a branch office need not be
connected directly to the main office. It can be connected indirectly by being
connected to another branch office that is connected (directly or indirectly) to
the main office. The only requirement is that every branch office be connected by
some route to the main office. The charge for the special phone lines is $100

a.

Formulate this problem as a shortest-path problem by drawing a network


where nodes represent towns, links represent roads, and numbers indicate
the length of each link in miles.

b.

If each number in the table represented your cost (in tens of pesos) for
driving your car from one town to the next, determine your minimum cost
route.

4.

Water is to be transported through a network of pipelines from the big dam to


the low valley for irrigation. The network is shown below where arcs represent
pipelines and the number on each arc represents the maximum permitted rate of
water flow in kilo-tons per hour. It is desired to determine the maximum rate of
flow from the big dam to the low valley.

5.

One of Speedy Airlines flights is about to take off from Seattle for a nonstop
flight to London. There is some flexibility in choosing the precise route to be
taken, depending upon weather conditions. The following network depicts the
possible routes under consideration, where SE and LN are Seattle and London,
respectively, and the other nodes represent various intermediate locations. The
winds along each arc greatly affect the flying time (and so the fuel consumption).
Based on current meteorological reports, the flying times (in hours) for this
particular flight are shown next to the arcs. Because the fuel consumed is so
expensive, the management of Speedy Airlines has established a policy of
choosing the route that minimizes the total flight time.

6.

During the early 1970s, the political scandal Watergate shook the United States
and toppled a presidency. While there were many aspects to the episode
(robbery, enemies lists, abuse of power, cover-ups, etc.), a key component was
the laundering of funds from big money contributors to campaign coffers. This
practice consists of channeling a large gift of money through various banks and
individuals so that its source cannot be traced. Unfortunately, such activities
continue today as evidenced by congressional investigations beginning in 1997.
Suppose millionaire I. S. Halverson has $5000 (in reality, he would probably
have 10 or 100 times this amount) that he would like to donate anonymously
to the Independent National Party (INP). He might first split the money up in
smaller units and deposit the money in several bank accounts spread throughout
the world. Money from these accounts could be mixed or further divided and
sent to other accounts or individuals, who, in turn, would do the same, until
several checks for $1000 or less eventually arrive at party headquarters.
To avert suspicion, a limit has been placed on the amount of each transaction
between intermediaries. These limits are given in the following network depicting
I. S. Halverson, the intermediaries, and the INP. Given these limitations, how
much of the $5000 can I. S. Halverson launder to the INP?
(Note: The federal government employs management scientists who also use
such models to help determine transaction limits that should be monitored.)

7.

Thirteen Savage Beasts is a popular rock group that has toured all over North
America. It is now beginning its Japanese tour and will be playing to a sold-out
house in a major sports stadium in Osaka.
After strategically positioning 12 banks of loudspeakers, the manager for the
group has found that the local government requires all cables and wires be
housed in specially insulated rigid casings. (In the United States, the group simply

lays the cables along the ground or across rafters, but this is unacceptable to the
Japanese authorities.)
A diagram of the stage area and the 12 banks of loudspeakers is shown in the
following figure.

The yearly operating costs include insurance, license, and normal repairs and
reflect the fact that the first year carries a full warranty, the second year a limited
warranty, and in the fifth year (when the car is four years old at the beginning of
the year) there is a major 60,000-mile service. Since John has been a valued lease
customer, the dealership will allow him to purchase his current two-year-old
vehicle (which cost $36,000 new) for the two-year trade-in price of .50($36,000) =
$18,000.
a. Complete the following shortest path representation of this problem.
What is the minimum amount of the insulated casings the group must
purchase before the rock concert can proceed?
(Note: Loudspeakers may be connected to one another or directly to the stage.)

8.

John Stanford is at the end of a two-year lease on his Lincoln Town Car, and,
although he is determined to drive a Lincoln Town Car for the next four years
(until his twins go to college), he simply refuses to lease another car, claiming,
Ownership is the only way. John can either purchase his two-year-old Lincoln
or purchase a new one. At the start of any subsequent year, he can trade in his
Lincoln for a new one. At the end of the fourth year, however, he will definitely
trade in his Lincoln for a Porsche, which he and his wife will share.
John would like to determine the optimal purchase/trade-in policy for the
next four years. To aid him in his decision process, the salesperson at the LincolnMercury/Porsche dealership (in whom John places complete trust) has given him
the following information.
b.

Solve this shortest path problem to determine the optimal purchase/trade-in


policy.

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