Minimum cost allocation can be determined by the transportation model in a satisfactory way as long as nonlinearity of shipping costs prevails.

Question

Quizplus · Accepted Answer

The statement is incorrect. The transportation model can be used to determine minimum cost allocation even in the presence of linear shipping costs. In fact, it is designed for such problems where the objective is to minimize the total shipping cost while satisfying supply and demand constraints. Nonlinear shipping costs would require the use of more advanced optimization models.

Minimum Cost Allocation Can Be Determined by the Transportation Model