8.2 A distribution center for a department store has four trucks available to deliver products to retail stores.

The company accrues shipping costs for all boxes that it ships and losses for all boxes that cannot fit on one of the four trucks and must be shipped later. Construct a model formulation that minimizes the total cost by determining the optimal number of boxes of each product to be delivered by each truck. Each truck has a trailer volume of 1000 ft and a weight limit of 50,000 lbs.
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Product Box Clothing Box Jewelery Box Pefume Box Shoes Box
Solution:

Boxes 400 400 400 400

Size (ft2) 5 2 2 6

Weight (lbs) 75 20 20 45

Cost of Shipping 55 70 65 50

Loss if Shipped Late 500 300 275 250

Our decision variable is the # of product boxes to be delivered by each truck. Since we do not need to identify which truck needs to deliver the items, we will not use the transportation model; instead we will just use product mix. For this particular problem, we are not considering profit but the cost. Therefore our goal is to MIN cost. The tricky part is that in order to come up with the cost, we need to sum the total shipping cost + the losses if we ship late. Shipping cost is given. Loss if ship late can be derived by multiplying the # of undelivered boxes (demand - # of delivered boxes) and the cost of losses. For the constraints, 1. We cannot exceed demand of 400 for each product box. 2. Truck trailer volume capacity considering the 4 trucks: 1,000cubic ft x 4 trucks = 4,000 cubic ft of boxes. (I believe there are inconsistencies between the unit of size, lets just assume that everything is cubic ft.) 3. Truck weight limit considering the 4 trucks: 50,000lbs x 4 trucks = 200K lbs of boxes

8.4 A toy company is expanding its toy vehicle product line. The company formerly produced only toy trains but now is expanding the line to include toy cars, trucks, and airplanes. The amount of each type of vehicle to produce must now be determined. A given table displays the expected production cost, sales price, required

machine hours, and required labor hours to produce a single unit of each type of toy vehicle. It costs $200 an hour to run the machine that produces cars, trucks, and trains and $250 an hour to run the machine that produces airplanes. All toy assembly workers are paid a wage of $7.25 an hour. Based on historical data, the product line manager forecasts that the demand for trains, cars, and trucks will be at least 500 units, and the demand for airplanes will be at least 250 units. The production cost of all toy vehicles cannot exceed $10,000, and no more than 1,000 labor hours can be spent on production. Formulate this problem to maximize the profit earned by the companys toy vehicle product line.

car truck train airplane

Solution:

Production Cost $2.15 $3.45 $4.65 $3.00

Sales Price $20.99 $22.99 $27.95 $30.00

Machine Hours 0.080 0.065 0.100 0.075

Labor Hours 0.17 0.25 0.19 0.23

This is clearly a product mix problem. Our decision variable is the amount of product to be produced for each line. The objective function should be the MAX of profit earned considering the cost of production. This means that we need to identify the total profit minus the total cost and the result will be the net profit. For the constraints, 1. We cannot exceed demand of each product 2. Total Production cost should not exceed $10,000. Total production cost can be computed by identifying the total cost per unit (production cost + machine cost + labor cost) multiplied by the amount produce. 3. Total Labor hours should not exceed 1,000 hours.