Quantitative Techniques: Theory and Problems

PRACTICAL STEPS INVOLVED IN SOLVING TRANSPORTATION PROBLEMS OF MAXIMIZATION TYPE

The practical steps involved in solving transportation problems of maximization type are given below:

Step 1 →	Derive Profit Matrix by calculating the Profit by the following equation:Profit = Selling Price - Production Cost - Transportation Cost
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Step 2 →	See whether Total Requirements are equal to Total Availability; if yes, go to Step 3; if not, introduce a Dummy Origin/Destination, as the case may be, to make the problem a balanced one, taking Profit per unit as zero for each Cell of Dummy Origin/Destination or as otherwise indicated.
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Step 3 →	Derive Loss Matrix by deducting each element from the largest element in order to use minimization ...