Application of Linear Programming Problem

Dr. Bright Emmanuel Owusu

[email protected]
March 13, 2023
Transportation Problem

• The transportation problem arises frequently in planning for the

distribution of goods and services from several supply locations to
several demand locations.

• Typically, the quantity of goods available at each supply

location(origin) is limited, and the quantity of goods needed at
each of several demand locations (destinations) is known.

• The usual objective of transportation problem is to minimize the

cost of shipping goods from the origins to the destinations.

2
Let us illustrate this by considering a transportation problem faced
by Foster Generators.
• This problem involves the transportation of a product from
three plants to four distribution centers. Foster Generators
operates plants in Cleveland, Ohio; Bedford, Indiana; and York,
Pennsylvania.

• Production capacities over the next three-month planning period

for one particular type of generator are as follows:

3
• The firm distributes its generators through four regional
distribution centers located in Boston, Chicago, St. Louis, and
Lexington.

• The three-month forecast of demand for the distribution centers

is as follows:

4
The network representation of the foster generators problem.

5
figure 6.1
Transportation Problem cont..

• Management would like to determine how much of its production

should be shipped from each plant to each distribution center.

• The figure above shows graphically the 12 distribution routes

Foster can use. Such a graph is called a network; the circles are
referred to as nodes and the lines connecting the nodes as arcs.
Each origin and destination is represented by a node, and each
possible shipping route is represented by an arc.

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• The amount of the supply is written next to each origin node,
and the amount of the demand is written next to each destination
node.

• The goods shipped from the origins to the destinations represent

the flow in the network. Note that the direction of flow (from
origin to destination) is indicated by the arrows.

7
• For Foster’s transportation problem, the objective is to
determine the routes to be used and the quantity to be shipped via
each route that will provide the minimum total transportation
cost.

• The cost for each unit shipped on each route is given in the
table below and is shown on each arc in the figure.

Table 6.1

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Transportation cost per unit for the foster generators transport
problem

A linear programming model can be used to solve this

transportation problem.
• We use double sub-scripted decision variables, with x11 denoting
the number of units shipped from origin 1 (Cleveland) to
destination 1 (Boston), x12 denoting the number of units shipped
from origin 1 (Cleveland) to destination 2 (Chicago), and so on.

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Transportation Problem cont...

• In general, the decision variables for a transportation problem

having m origins and n destinations are written as follows:

xij = number of units shipped from i to destination j

where i=1, 2, . . . , m and j=1, 2, . . . , n

• Because the objective of the transportation problem is to

minimize the total transportation cost, we can use the cost data in
Table 6.1 or on the arcs in Figure 6.1 to develop the following cost
expressions:

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• Transportation Cost for units shipped from Cleveland

3x11 + 2x12 + 7x13 + 6x14

• Transportation Cost for units shipped from Bedford

7x21 + 5x22 + 2x23 + 3x24

• Transportation Cost for units shipped from York

2x31 + 5x32 + 4x33 + 5x34

The sum of these expressions provides the objective function

showing the total transportation cost for Foster Generators.

11
• Transportation problems need constraints because each origin has
a limited supply and each destination has a demand requirement.

• We consider the supply constraints first. The capacity at the

Cleveland plant is 5000 units.

• With the total number of units shipped from the Cleveland plant
expressed as x11 + x12 + x13 + x14 , the supply constraint for the
Cleveland plant is:

x11 + x12 + x13 + x14 ≤ 5000 Cleveland supply

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• With three origins (plants), the Foster transportation problem
has three supply constraints.

• Given the capacity of 6000 units at the Bedford plant and 2500
units at the York plant, the two additional supply constraints are;

x21 + x22 + x23 + x24 ≤ 6000 Bedford supply

x31 + x32 + x33 + x34 ≤ 2500 York supply

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• With the four distribution centers as the destinations, four
demand constraints are needed to ensure that destination demands
will be satisfied:

x11 + x21 + x31 = 6000 Boston demand

x12 + x22 + x32 = 4000 Chicago demand
x13 + x23 + x33 = 2000 St. Louis demand
x14 + x24 + x34 = 1500 Lexington demand

NB To obtain a feasible solution, the total supply must be greater

than or equal to the total demand.

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• Combining the objective function and constraints into one model
provides a 12-variable, 7-constraint linear programming formulation
of the Foster Generators transportation problem:

Min 3x11 + 2x12 + 7x13 + 6x14 + 7x21 + 5x22 + 2x23 + 3x24 +

2x31 + 5x32 + 4x33 + 5x34
s.t. x11 + x12 + x13 + x14 ≤ 5000
x21 + x22 + x23 + x24 ≤ 6000
x31 + x32 + x33 + x34 ≤ 2500
x11 + x21 + x31 = 6000
x12 + x22 + x32 = 4000
x13 + x23 + x33 = 2000
x14 + x24 + x34 = 1500
xij ≥ 0 for i=1,2,3 and j=1,2,3,4

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• Comparing the linear programming formulation to the network in
Figure 6.1 leads to several observations. All the information
needed for the linear programming formulation is on the network.

• Each node has one constraint, and each arc has one variable.
The sum of the variables corresponding to arcs from an origin node
must be less than or equal to the origin’s supply, and the sum of
the variables corresponding to the arcs into a destination node
must be equal to the destination’s demand.

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• The solution to the Foster Generators problem (see Figure 6.2)
shows that the minimum total transportation cost is $39,500. The
values for the decision variables show the optimal amounts to ship
over each route.

• For example, with x11 =3500 units, which should be shipped from
Cleveland to Boston, and with x12 =1500 units to be shipped from
Cleveland to Chicago. Other values of the decision variables
indicate the remaining shipping quantities and routes.

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The solution for the foster generators transportation problem

18
Transportation Problem

Table 6.2 shows the minimum cost transportation schedule and

Figure 6.3 summarizes the optimal solution on the network.

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Transportation Problem

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Remark

• The transportation problem is one the subclasses of LPPs in

which the objective is to transport various quantities of a single
homogeneous commodity that are initially stored at various origins
to different destinations in such a way that the transportation cost
minimum.

• To achieve this this objective, we realized from our example that

we must know the amount and location of available supplies and
the quantities demanded. In addition we must know the cost that
results from transporting one unit of commodity from various
origins to various destinations.

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Mathematical Formulation

Consider a transportation problem with m origins (rows) and n

destinations (columns). Let Cij be the cost of the transportation of
one unit of the product from the i th origin to j th destination. ai is
the quantity of the commodity available at origin i, bj the quantity
of the commodity needed at destination j. xi j is the quantity
transported from i th origin to j th destinations. The above
transportation problem can be stated in the tabular form below.

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Diagram

23
The linear programming model representing the transportation
problem is given by

Pm Pn
Minimize Z= i=1 j=1 cij xij

s.t the constraints

Pn
j=1 xij = ai i=1,2,...,n
(Row sum)
Pm
i=1 xij= bj j=1,2,...,n
(Column sum)
xij ≥ 0 for all i and j.

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The given transportation problem is said to be balanced if

Pm Pn
i=1 ai = j=1 bj

ie. if the total supply is equal to the total demand.

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Definitions

• Feasible Solution: Any set of non negative allocations (x>0)

which satisfies the row and column sum (rim requirement) is called
a feasible solution.
• Basic Feasible Solution: A feasible solution is called a basic
feasible solution if the number of non negative allocations is equal
to m+n-1 where m is the number of rows and n is the number of
columns in a transportation table.

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Definitions

• Non degenerate Basic Feasible Solution: Any feasible

solution to a transportation problem containing m origins and n
destinations is said to be non-degenerate if it contains m+n-1
occupied cells and each allocation is in independent positions.
• Degenerate Basic feasible Solution: If a basic feasible solution
contains less than m+n-1 non negative allocations, it is said to be
degenerate.

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Optimal Solution

Optimal solution is a feasible solution (not necessarily basic)

which minimizes the total cost. The solution of a transportation
problem can be obtained in two stages namely initial solution and
optimum solution. Initial solution can be obtained by using any
one of the three methods;
• North west corner rule (NWCR)
• Least cost method or Matrix minima method
• Vogel’s approximation method (VAM)
NB: VAM is preferred over the other two methods, since the initial
basic feasible solution obtained by this method is either optimal or
very close t the optimal solution.

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• The cells in the transportation table can be classified as
occupied cells and unoccupied cells. The allocated cells in the
transportation table is called occupied cells and empty cells and
the empty cells in a transportation table is called unoccupied cells.
• The improved solution of the initial basic feasible solution is
called optimal solution which is the second stage of the solution,
that can be obtained by MODI (modified distribution method).

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North West Corner Rule

The steps involved in this method for finding the initial solution are
as follows
Step 1 starting with the cell at the upper left corner (North west)
of the transportation matrix we allocate as much as possible so
that either the capacity of the first row is exhausted or the
destination requires of the first column is satisfied ie.
x11 = min(a1 , b1 ).
Step 2 if b1 > a, we move down vertically to the second row and
make the second allocation of magnitude x22 = min(a2 , b1 − x11 )
in the cell (2,1).

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if b1 < a1 , move right horizontally to the second column and make
the second allocation of magnitude x12 = min(a1 , x11 − b1 ) in the
cell (1,2)
if b1 = a1 there is a tie for the second allocation, we make the
second allocations of magnitude

x12 = min(a1 − a1 , b2 ) = 0 in a cell (1,2)

or x21 = min(a2 , b1 − b1 ) = 0 in cell (2,1)

Step 3 Repeat steps 1 and 2 moving down towards the lower right
corner of the transportation table until all the rim requirements are
satisfied.

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Example

Obtain the initial basic feasible solution of a transportation

problem whose cost and rim requirements are satisfied.

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Solution

P P
Since ai = 34 = bj there exist a feasible solution to the
transportation problem. We obtain initial feasible solution as
follows.

The first allocation is made in cell (1,1) with the magnitude being
x11 = min(5, 7) = 5. The second allocation is made in the cell
(2,1) also with magnitude x21 = min(8, 7 − 5) = 2 and so on.

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hence we get the initial basic feasible solution to the given
transportation problem as;
x11 = 5;x21 = 2;x22 = 6;x32 = 3;x33 = 4;x43 = 14
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Total cost= 2×5+3×2+3×6+3×4+4×7+2×14
= 10+6+18+12+28+28
=102

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Least Cost or Matrix Minima Method

The steps involved in this method for finding the initial solution are
as follows
Step 1 Determine the smallest cost in the cost matrix of the
transportation table. Let it be Cij . Allocate xxij = min(a1 , bj ) in
the cell (i,j).
Step 2 if xij = ai cross off the i th row of the transportation table
and decrease bj by ai . Then go to step 3.
if xij = bj cross off the j th column of the transportation table and
decrease ai by bj . Go to step 3.
if xij = ai = bj cross off either the i th row or the j th column but
not both.

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Step 3 Repeat steps 1 and 2 for the resulting reduced
transportation table until all the rim requirements are satisfied.
Whenever the minimum cost is not unique, make an arbitrary
choice among the minima.

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Example

Obtain the initial basic feasible solution to the following

transportation problem using the Matrix maxima method.

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Solution

P P
Since ai = 24 = bj , there exist a feasible solution to the
transportation problem using the steps in the least cost method.

The first allocation is made in the cell (3,1) with the magnitude
x31 = 4. Which satisfies the demand at the destination D1 and we
delete this column from the table as it is exhausted. The second
allocation is made in the cell (2,4) with magnitude x24 = 6. Since
it satisfies the demand at the destination D4 , it is deleted from the
table. From the reduced table the other allocations are done
similarly.

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The solution is given by x12 = 6; x23 = 2; x24 = 6; x31 = 4; x33 = 6
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Since the total number of occupied cell=5<m+n-1 we get a
degenerate solution.

Total cost= 6×2+2×2+6×0+4×0+6×2

=12+4+12
=28

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Vogel’s Approximation Method(VAM)

The steps involved in this method for finding the initial solution are
as follows
Step 1 Find the penalty cost, namely the difference between the
smallest and next smallest costs in each row and column.
Step 2 Among the penalties as found in step(1) choose the
maximum penalty. If this maximum penalty is more than one
choose any one arbitrarily.
Step 3 In the selected row or column as by step(2) find out the
cell having the least cost. Allocate to this cell as much as possible
depending on the capacity and requirements.

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Step 4 Delete the row or column which is fully exhausted. Again
compute the column and row penalties for the reduced
transportation table and then go to step(2). Repeat the procedure
until all the rim requirements are satisfied.
NB If the column is exhausted, the there is change in row penalty
and vice versa.

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Example

Find the initial basic feasible solution for the following

transportation problem by VAM.

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Solution

P P
Since ai = bj = 950 we say the problem is balanced and there
is a feasible solution to the problem.
First we find the row and the column penalty PI as the difference
between the least and the next least cost. The maximum penalty is
5, now we choose the first column arbitrarily. In this column
choose the cell having the least cost name (1,1). Allocate to this
cell with minimum magnitude (ie. min(250,200)=200). This
exhausts the first column so we delete it. Then there is is a change
in row penalty PI and column penalty pII remains the same.
Continuing like this manner gives the remaining allocations.

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Allocation 1

46
Allocation 2

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Allocation 3

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Allocation 4

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Allocation 5

50
Allocation 6

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Initial basic feasible solution

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Optimality Test

• Once the initial basic feasible solution has been computed, the
next step in the problem is to determine whether the solution
obtained is optimum or not.
• Optimality test can be conducted to any initial basic feasible
solution of a transportation problem provided such allocations has
exactly m+n-1 non negative allocations. Where m is the number
of origins and n is the number of destinations. Also these
allocations must be in independent positions.
To perform this optimality test, we shall discuss the modified
distribution method (MODI).

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MODI Method

The various steps involved in MODI method for performing

optimality test are given below.
Step 1 Find the initial basic feasible solution of a transportation
problem by using any of the three methods.
Step 2 Find out a set of numbers ui and vj for each row and
column satisfying ui +vj =cij for each occupied cell. To start with
we assign a number ’0’ to any row of having a maximum number
of allocations. If this maximum number of allocations is more than
one, choose any one arbitrarily.

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Step 3 For each empty (unoccupied) cell, we find the sum u, and
v written in the bottom left corner of that cell.
Step 4 Find out for each empty cell the net evaluation value
∆ij = ci,j − (ui + vj) and which is written at the bottom right
corner of that cell. This step gives the optimality conclusion.
1. If all ∆ij > 0 (ie. all the net evaluation value) the solution is
optimum and a unique solution exist.
2. if ∆ij ≤ 0 then the solution is optimum, but an alternate
solution exists.
3. If at least one ∆ij < 0, the solution is not optimum. In this
case we go to the next step, to improve the total
transportation cost.

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Step 5 Select the empty cell having the most negative value of
∆ij . From this cell we draw a closed path by drawing horizontal
and vertical lines with the corner cells occupied. Assign sign + and
- alternatively and find the minimum allocation from the cell
having negative sign. This allocation should be added to the
allocation having positive sign and subtracted from the allocation
having negative sign.
Step 6 The above step yield a better solution by making one (or
more) occupied cell as empty and one empty cell as occupied. For
this new set of basic feasible allocations repeat from the step(2)
till an optimum basic feasible solution is obtained.

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Example

Consider this initial basic feasible solution

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From the table above we see that the number of non-negative
independent allocations is 6=m+n-1=3+4-1
hence, the solution is non-degenerate basic feasible.
∴ the initial transportation cost
=11×13+3×14+4×23+6×17+17×10+18×9
=Rs 711

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To find the optimal solution we apply Modi method in order to
determine the optimum solution. We determine a set of numbers
ui and vj for each row and column, with ui + vj = cij for each
occupied cell. To start with we give u2 = 0 as the 2nd row has the
minimum number of allocations.

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u2 = 0
u2 + v1 = c21 = 17, 0 + v1 = 17
v1 = 17
u2 + v3 = c23 = 14, 0 + v3 = 14
v3 = 14
u2 + v4 = c24 = 14, 0 + v4 = 23
v4 = 23
u1 + v4 = c14 = 13, u1 = 13 − 23
u1 = −10
u3 + v3 = c33 = 18, u3 = 18 − 14
u3 = 4
u3 + v2 = c32 = 17, v2 = 17 − 4
v2 = 13
Now we have u1 = −10, u2 = 0, u3 = 4, v1 = 17, v2 = 13,
v3 = 14,and v4 = 23.

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New Table

61
Now we find the of ui and vj for each empty cell and enter at the
bottom left corner of that cell.

62
Next we find the net evaluations ∆ij = Cij − (ui + vj) for each
unoccupied cell and enter at the bottom right corner of that cell.

63
Since all ∆ij > 0 the solution is optimal and unique. The optimum
solution is given by
x14 = 11, x21 = 6, x23 = 3, x24 = 4, x32 = 10, x33 = 9
The min. transportation cost is =
11×13=17×6+3×14+4×23+10×17+9×18
=Rs 711

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Degeneracy in Transportation problem

In a TP, if the number of non degenerate independent allocations

is less than m+n-1, where m is the number of origins (rows) and n
is the number of destinations (column) there exists a degeneracy.
This may occur either at the initial stage or at subsequent
iterations. To resolve this degeneracy. we adopt the following
steps. Namely;
• Among the empty cell, we choose an empty having having the
least cost which is of an independent position. If this cell is more
than one, choose any one arbitrarily.
• To the cell as chosen in step(1) we allocate a small positive
quantity ϵ>0.

65
The cells containing ϵ are treated like other occupied cells and
degenerate is removed by adding one (more) accordingly. For this
modified solution, we adopt the steps involved in MODI method
till an optimum solution is obtained.

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Example

Consider this initial basic feasible solution

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The initial transportation cost is
= 10×2+4×10+5×1+10×3+1×30=Rs 125
To find the optimal solution(MODI method) we sue the
above table to apply the MODI method. To start with we realise
that there is a maximum of 2 allocations in more than one row and
column, so we choose arbitrarily column 1, and assign a number 0
to this column (ie. v1 = 0). The remaining numbers can be
obtained as follows.

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v1 = 0
u1 + v1 =2 u1 + 0 = 2, u1 = 2
u2 + v1 =4 u2 + 0 = 4, u2 = 4
u2 + v2 =1 4 + v2 = 1, v2 = −3
u3 + v 2 =3 u3 − 3 = 3, u3 = 6
u3 + v 3 =1 6 + v3 = 1, v3 = −5

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New table

70
We find the sum of ui and vj for each empty cell and write it at
the bottom left corner of that cell. Find the net evaluations
∆ij =cij − (ui + vj) for each empty cell and enter at the bottom
right corner of the cell.

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The solution is not optimal as the cell (3,1) has a negative ∆ij
value. We improve the allocation by making this cell (3,1) as an
allocated cell. We draw a closed path from this cell and assign sign
+ and - alternatively.
From the cell having negative sign we find the minimum allocation,
thus min(10,10)=10. Hence, we get two occupied cell (2,1),(3,2)
which becomes empty and cell (3,1) becomes occupied and this
results in a degenerate solution.
Thus, number of allocated cells=4 < m + n − 1 = 5
We get degeneracy. To resolve we add the empty cell (1,2) and
allocate ϵ > 0. This cell namely (1,2) is added as it satisfies the
two steps for resolving the degeneracy.

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Degeneracy

73
We assign a number 0 to the first row, namely u1 = 0 we get the
remaining numbers as follows.
u1 = 0
u1 + v1 = 2, 0 + v1 = 2,
v1 = 2
u3 + v1 = 1, u3 + 2 = 1,
u3 = −1
u1 + v2 = 2, 0 + v2 = 2,
v2 = 2
u2 + v2 = 1, u2 + 2 = 1,
u2 = −1
u3 + v3 = 1, −1 + v3 = 1,
v3 = 2
u1 = 0, u2 = −1, u3 = −1, v1 = 2, v2 = 2, v3 = 2

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New table

75
Next we find the sum ui and vj for the empty cell and enter at the
bottom left corner of that cell and also the net ∆ij = cij − (ui + vj )
for each empty cell and enter at the bottom right corner of the cell.

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The modified solution is given in the following table. This solution
also optimal and unique as it satisfies the optimality condition that
all ∆ij >0
x11 = 10; x22 = 15; x33 = 30; x12 = ϵ; x31 = 10;
Total cost= 10×2+2×ϵ+15×1+10×1+30×1
=75+2ϵ
=Rs 75

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Problem Variations

The Foster Generators problem illustrates use of the basic

transportation model. Variations of the basic transportation model
may involve one or more of the following situations:
• Total supply not equal to total demand
• Maximization objective function
• Route capacities or route minimums
• Unacceptable routes
With slight modifications in the linear programming model, we can
easily accommodate these situations.

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Total Supply Not Equal to Total Demand

A given transportation problem is said to be unbalanced if

ai ̸= bj ie. if the total supply is not equal to the total
P P

demand. There two possible cases;

CASE I: m n
P P
i=1 ai < j=1 bj If the total supply is less than the
total demand a dummy source (row) is included in the cost matrix
with zero cost, the excess demand is entered as a rim requirement
for this dummy source (origin). Hence, the unbalanced
transportation problem can be converted into a balanced
transportation problem.

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CASE II: m n
P P
i=1 ai > j=1 bj
If the total supply is greater than the total demand then the
unbalanced transportation is problem can be converted into a
balanced one by adding a dummy destination (column) with zero
cost.The excess supply is entered as a rim requirement for the
dummy destination.

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Example

Solve the transportation problem with the following cost, demands

and supplies

81
 P
Since the total demand bj = 215 is greater than the total
P
ai = 195 the problem is an unbalanced transportation problem.
We convert this into a balanced transportation problem by
introducing a dummy origin O4 with cost zero and giving supply
equal 215 − 195 = 20 units. Hence, we have the converted
problem as follows

82
83
Initial Solution table

The initial solution to the people is given by

84
There are 7 independent non-negative allocations equal to m+n-1.
hence, the solution is a non-degenerate one.
The total transportation
cost=6×65+5×1+5×30+2×25+4×25+7×45+20×0
=Rs 1010

85
To find the optimal solution we apply the MODI method to the
table above to get

86
sum of ui + vj

87
cij − (ui + vj )

88
Since not all ∆ij > 0 the solution is not optimal and cell (3,1) has
the most negative value of ∆ij we modify the solution by adding
and subtracting the min allocation given by the min (65,30,25).
While doing this the occupied cell (3,3) becomes empty.

89
90
New allocation

91
As the number of independent allocations are equal to m+n-1 we
check for optimality. First ui and vj values.

92
sum of ui and vj

93
cij − (ui + vj )

94
Since all ∆ij ≥ 0 the solution is optimal and an alternate solution
exists as ∆ij = 0. Therefore, the optimum allocation is given by
x11 = 40, x12 = 30, x22 = 5, x23 = 50, x31 = 25, x43 = 10 and
x14 = 20
The optimum transportation cost is
= 6×40+1×30+5×5+2×50+10×25+7×45+0×20
=Rs 960

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Maximization Objective Function

In some transportation problems, the objective is to find a solution

that maximizes profit or revenue. Using the values for profit or
revenue per unit as coefficients in the objective function, we simply
solve a maximization rather than a minimization linear program
and this change does not affect the constraints.

96
Route Capacities or Route Minimums

• The linear programming formulation of the transportation

problem also can accommodate capacities or minimum quantities
for one or more of the routes.

• For example, suppose that in the Foster Generators problem the

York–Boston route (origin 3 to destination 1) had a capacity of
1000 units because of limited space availability on its normal mode
of transportation.

• With x31 denoting the amount shipped from York to Boston, the
route capacity constraint for the York–Boston route would be

x31 ≤ 1000

97
Unacceptable Routes

• Establishing a route from every origin to every destination may

not be possible. To handle this situation, we simply drop the
corresponding arc from the network and remove the corresponding
variable from the linear programming formulation.

• For example, if the Cleveland–St. Louis route were unacceptable

or unusable, the arc from Cleveland to St. Louis could be dropped
in Figure 6.1, and x13 could be removed from the linear
programming formulation.

98
A General Linear Programming Model

To show the general linear programming model for a transportation

problem with m origins and n destinations, we use the notation:
xij = number of units shipped from origin i to destination j
cij = cost per unit of shipping from origin i to destination j
si = supply or capacity in units at origin i
dj = demand in units at destination j

The general linear programming model is as follows:

Pm Pn
Min i=1 j=1 cij xij

s.t.
Pn
j=1 xij ≤ si i= 1, 2,..., m Supply
Pm
i=1 xij = dj j= 1, 2,..., n Demand
xij ≥ 0 for all i and j.
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