Consider the Transportation Problem in the Data Set and Optimal

question 73

Short Answer

Consider the transportation problem in the data set and optimal solution below.
Calculate improvement indices on each empty cell. Is this solution optimal?
$\begin{array}{|l|r|r|r|r|r|}\hline \text { COSTS } & \text { Dest. 1 } & \text { Dest. 2 } & \text { Dest. 3 } & \text { Dest 4 } & \text { Supply } \\\hline \text { Source 1 } & 12 & 18 & 9 & 11 & 100 \\\hline\text { Source 2 } & 21 & 7 & 30 & 15 & 150 \\\hline \text { Source 3 } & 8 & 10 & 14 & 16 & 50 \\\hline\text { Demand } & 80 & 60 & 70 & 90 & 300/300 \\\hline & & & & & \\\hline \text { Shipments } & \text { Dest. 1 } & \text { Dest. 2 } & \text { Dest. 3 } & \text { Dest. 4 } & \text {Row Total } \\\text { Source 1 } & 30 & 0 & 70 & 0 & 100 \\\text { Source 2 } & 0 & 60 & 0 & 90 & 150 \\\text { Source 3 } & 50 & 0 & 0 & 0 & 50 \\\text { Col. Total } & 80 & 60 & 70 & 90 & 300/300 \\\hline\end{array}$

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Definitions:

Short-Term Financing

Borrowing options intended for a short period, typically less than a year, to cover immediate needs.

Matching Principle

An accounting concept stating that expenses should be matched with the revenues they help to generate, ensuring accurate financial reporting.

Working Capital

The difference between a company’s current assets and current liabilities, showing its short-term financial health and operational efficiency.

Vendors

Entities that supply goods or services to another, typically for business purposes.