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This method is more systematic and orderly than least cost method. Here penalties for each column and row of the transportation table are determined, and the row or column with largest penalty is chosen for allocation. Then the cell with lowest cost form the selected row column is allocated the maximum possible.
After this the row or column whose supply or demand is exhausted is exhausted is deleted and the penalties are again calculated for the shrunken table. The procedure continue still full demand supply is exhausted. Here penalty of each row column = ( second lowest - lowest costs of that row / column.
1. A local university purchases exercise books to give to their students. Instead of a fixed unit cost, their supplier quotes the following discount pricing: Order quantity Unit P
formulate the linear programming model of the table above
DISCUSS THE SIGNIFICANCE AND SCOPE OF OPERATION RESEARCH IN MODERN MANAGEMENT
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