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Chapter 5 - Network Design
Variety of models
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2. Gravity location model

3. Determine Shipments (xij) to maximize profit on one item
There are two manufacturing/distribution centers (MDi) with unit costs $2.50 and $2.75 respectively and at x,y locations (200,400) and (500,600), supplying 3 markets (Mj) located at (300,300), (500,700) and (900,900). The demand Dj in each market is a function of Price (Pj) and is determined by the equation
(Aj -ln(PjCj))/Bj, where the coefficients are :
Shipping cost per mile $0.01
Maximum Price due to competition $10