P&T shipping problem

Questions to ask to put together the problem

What are the decisions to be made? (decision variables)
--> Number of truckloads from each cannery to each warehouse
What are the constraints on these decisions? (constraints)
--> Total amount shipped from each cannery must be equal to its output (supply)
--> The total amount received by each warehouse must equal its allocation (demand)
What is the overall measure of performance for these decisions? (Objective function)
--> Minimized shipping costs


Northern Airplane Co problem

Questions

What are the decisions to be made?
--> Number of engines produced in month i for installation is month j
What are the constraints on these decisions?
--> Number engines produced (supply)
--> Number of engines installed (demand)
What is the overall measure of performance for these decisions?
--> Minimized cost


How to set up a problem in Excel

- Identify the decision variables
- Identify the constraints
- Program the objective function

Input into the solver to get optimal solution
- Depending on the problem, the constraints may be equalities or inequalities