Assignment No.

1
Submitted to. Dr. Madeeha Ghamkhar
Submitted by. Arfa sehar
Hira tariq
Amna kouser
Hina zubair
Momina
M. usman
M. Bakir Hussain
Department. Mathematics and statistics
Degree. Mphil Math
Course code. Math-712
Course Title. Advance operational resurch

University Of Agriculture
Faisalabad
 Title
• Transportation problem
• Mixed Constraints
• More-for-less paradox

Abstract
This study explores the challenge of solving transportation
problems (TP) featuring mixed constraints, a scenario more
reflective of real-world complexities than the extensively studied
(TP) with equality constraints. Such problems are prevalent
across various fields including job scheduling, inventory
management, distribution, allocation tasks, and investment
analysis. Despite the ubiquity of these problems, there is a
notable absence of systematic methodologies for achieving
optimal solutions, particularly in addressing the "more-for-less"
(MFL) paradox. This paradox arises when it is feasible to
transport an increased quantity of goods at a lower or equivalent
cost, without compromising the non-negative cost stipulation or
the quantities shipped from origins to destinations.

Introduction
In the study of planning and moving goods, a lot of work has
been done on simple problems where everything matches up
perfectly. But in the real world, things are more complicated.
Problems can include different kinds of limits and rules that apply
to a variety of situations like scheduling jobs, managing inventory,
distributing products, deciding where to put resources, and
figuring out investments. These real-life problems are tricky and
haven't been studied as much, especially when it comes to finding
the best way to do things without spending too much. One
interesting challenge is the "more-for-less" (MFL) paradox, where
you can move more goods without increasing the cost, and still
follow all the rules.
Previous solutions to this problem were complex and involved a
lot of extra steps and math. This paper suggests a simpler way to
look at the problem by using ideas from previous research but
making them easier to understand and use. This new method
could help managers and planners find better ways to move
goods and resources around, saving time and money while
dealing with complicated rules.

Report of problems
Example.1
Understanding Through a Cost Matrix:
Consider a scenario where we have a cost matrix as follows, which
represents the transportation cost from sources (a1, a2, a3) to
destinations (b1, b2, b3), alongside their respective supply and
demand constraints:
• a1 to b1 costs 10, to b2 costs 1, and to b3 costs 4, with an
exact supply of 5 units.
• a2 to b1 costs 5, to b2 costs 7, and to b3 costs 1, with a
supply of at least 6 units.
• a3 to b1 costs 8, to b2 costs 9, and to b3 costs 2, with a
supply of up to 9 units.
• The demand for b1 is 8 units, for b2 is exactly 10 units, and
for b3 is at most 5 units.
Step-by-Step Process:
Initial Consideration of TP: Begin by examining the given
TP with its constraints, noting any imbalances in supply and
demand.
Assignment via Vogel’s Approximation Method (VAM):
Assignments are made to minimize cost, leading to initial
allocations - X12 (from a1 to b2) is 5 units, and X21 (from a2
to b1) is 6 units.
Solving the Unbalanced Linear Bottleneck Problem (LBP):
Further allocations are made to address the imbalance,
resulting in X12 being 5 units, X21 being 8 units, X22 being 5
units, and all other allocations set to zero. This yields a total
transportation flow of 18 units at a cost of 80 units.
Shadow Prices (SP) Matrix Construction: Following the
solution from step 3, a shadow price matrix is constructed to
identify potential cost reductions, with certain cells marked
to indicate their relevance in the solution.
Analysis for Negative Shadow Prices: The method
identifies rows with negative shadow prices to pinpoint
opportunities for cost optimization.
Identification of Loading Cells: Focus on rows with single
loading cells to streamline the analysis.
Allocation Maximization: Based on the analysis,
adjustments are made to allocations to maximize efficiency,
such as assigning X12 to the maximum of a1 or b2, which in
this case is 10 units.
Matrix Reduction: Following the reallocation, the problem is
reduced by removing the fully satisfied constraints, leading
to a simplified matrix for further analysis.
Final Adjustments and Solution: The reduced matrix is
analyzed with no negative shadow prices remaining. The
problem is then solved within these new constraints, leading
to an optimal solution matching that found in the referenced
study - X12 being 10 units, X21 being 8 units, with a total
flow of 18 units at a reduced cost of 50 units.
This step-wise process demonstrates a structured approach
to solving transportation problems, even in instances where
constraints and demands create imbalances, showcasing
efficiency in achieving cost optimization through strategic
allocation and reallocation.
Example 2.
This example presents the resolution of a transportation problem (TP)
using various steps, including the Vogel Approximation Method (VAM),
shadow prices (SP) analysis, and adjustments to the initial solution to
find a more cost-effective solution. The problem involves three supply
nodes (a1, a2, a3) and three demand nodes (b1, b2, b3) with varying
supply, demand, and transportation costs.
Initial Problem Statement
The initial cost matrix provided outlines the transportation costs
between each pair of supply and demand nodes. Additionally, the
supply and demand constraints are indicated, with some having exact
amounts while others have inequalities representing minimum or
maximum constraints. The demand is specified as 8, 10, and 5 units for
b1, b2, and b3, respectively, with varying conditions of equality and
inequality. The supplies are 5, 6, and 9 units for a1, a2, and a3,
respectively, also under various conditions.
Problem Consideration
The transportation problem (TP) is considered with the given
constraints, and a first attempt at finding a solution is made.
Initial Assignment Using VAM
The Vogel Approximation Method is utilized to make initial allocations
based on the cost differences between the lowest and second-lowest
costs in each row and column. This step resulted in assigning X11 = 5
and X22 = 6.
Solution to the Unbalanced Problem
After further analysis and adjustments to meet the constraints, the
solution to the unbalanced problem was found with allocations X11 = 5,
X21 = 3, and X22 = 10, achieving a total flow of 18 units at a cost of 58
units.
Shadow Price Matrix Development
The shadow price (SP) matrix was developed to identify potential
improvements to the current solution. The matrix highlights the
additional cost or saving for transporting one more unit through each
path not currently used in the solution.
Analysis and Adjustment Based on SP
The analysis of the SP matrix identified opportunities to reduce costs
further by reallocating shipments. Specifically, row 1's analysis led to
increasing the allocation for X11 to 8 units, optimizing the distribution
according to the cost and demand constraints.
Reduction of the Problem
Following the reallocation, the problem matrix was reduced by
eliminating row 1 and column 1, corresponding to the now fully
satisfied demand and supply of node b1 and a1, respectively.
Final Solution
The reduced problem was solved without negative shadow prices,
leading to an adjusted final solution. This solution maintained the total
flow but at a reduced total cost of 46 units, highlighting an
improvement from the initial solution. The final allocations were X11 =
8 and X22 = 10, with all other shipments set to zero.
Conclusion
This example illustrates the iterative process of solving a transportation
problem, starting with an initial approximation and refining the solution
through shadow price analysis and adjustments to meet supply and
demand constraints effectively. The final solution achieved a significant
reduction in total transportation costs while satisfying all constraints,
demonstrating the effectiveness of the methodology used. This
approach and solution align with the findings presented by previous
studies, reinforcing the validity of the methods applied.

Example 3
Initial Consideration
The initial transportation problem is defined with suppliers (a1, a2, a3)
and destinations (b1, b2, b3) along with their respective supply and
demand constraints. The cost matrix provided the basis for our
computations.
Assignment using VAM
Utilizing the Vogel's Approximation Method (VAM), initial allocations
were made as follows: X21 = 6 units, X22 = 4 units, and X23 = 5 units,
ensuring that the most significant discrepancies between the lowest
and second-lowest costs in rows and columns were addressed first. This
step ensures an efficient initial allocation towards minimizing total
transportation cost.
Unbalanced LBP Solution
The solution obtained from Step 2 was refined by adding X32 = 6 units
to balance the transportation problem, resulting in a total flow of 21
units at a total cost of 98.
SP Matrix Calculation
A shadow price (SP) matrix was computed to identify opportunities for
cost reduction. The SP matrix revealed negative shadow prices in row 3,
indicating potential for further optimization.
MFL Adjustment
Upon identifying the negative shadow prices, the method proceeded
with adjusting the allocations to harness the Modified Freight Load
(MFL) opportunity, assigning X32 = 10 units and thus, enhancing the
transportation plan.
Matrix Reduction
Following the MFL adjustment, row 3 and column 2 were removed from
consideration, simplifying the cost and SP matrices for further analysis.
Final Optimization
The reduced SP matrix showed no negative shadow prices, indicating an
optimized solution. The final transportation plan was adjusted to meet
the remaining supply and demand constraints, resulting in allocations
of X21 = 6 units and X23 = 9 units, along with the MFL-adjusted X32 =
10 units. This optimized plan increased the total flow to 25 units at a
reduced total cost of 86.
Conclusion
The application of the Modified Freight Loads (MFL) concept, coupled
with the Vogel's Approximation Method (VAM) and strategic
adjustments based on shadow pricing, demonstrated a robust approach
to optimizing unbalanced transportation problems. This method not
only achieved a lower total transportation cost but also increased the
efficiency of resource utilization by optimizing freight loads beyond
traditional constraints. The final solution, aligning with the principles
outlined by earlier research, emphasizes the effectiveness of
integrating shadow prices and MFL adjustments to resolve
transportation challenges innovatively.
Future Recommendations
For practitioners and researchers engaging in transportation logistics
and optimization, this example underscores the value of considering
modified freight loads and shadow pricing as strategic tools. Future
studies could explore the scalability of these methods across larger and
more complex transportation networks, potentially integrating
advanced computational algorithms for enhanced efficiency and cost-
effectiveness.
This report, through its detailed walkthrough of the optimization
process, aims to contribute to the broader understanding and
application of advanced transportation problem-solving methodologies
within the field of management science and engineering management.