Least cost Method

Abstract :

The Least-cost Method is the one of the method for finding the Initial Basic
Feasible Solution. This is the one of the method for solving the given Transpotaton
problem. The main purpose is the total Transportation cost is Minimum. This concept is
referred from internet and from books.

Introduction :

The Least-cost method is one of the method for finding the Initial basic
feasible Solution for the given Transportation problem. This method also called as
Matrix minima method.

The least-cost method finds a better starting solution by concentrating on the

cheapest routes. The method starts by assigning as much as possible to the cell with
the smallest unit cost.

Objectives :
The objectives of the study are,

• Solve the transportation problems by using Least cost method.

• Test the optimality of the solution.

Purpose of the study :
The purpose of the study is to get the Transportation cost of a given
Transportation problem.

Methodology :
The following steps to be taken for finding the Initial basic feasible solution by
using Least cost method for given Transportation problem .

Steps :

I) Determine the Smallest cost in the cost matrix of the Transportation

table. Let it be C ij allocate,
X ij = min (ai , bj) in the cell (i, j).

II) If xij = ai , Cross off the ‘i’ th row of the Transportation table and decrease

bj by ai then goto step-III

If xij = bj , Cross off the ‘j’ th row of the Transportation table and decrease

ai by bj then goto step-III

If xij = ai= bj , Cross off either ‘i’ th row (or) ‘j’th column but not both.

III) Repeat above Step-I and Step-II for the resulting reduced transportation table
 until all rim requirements are satisfied.

Whenever the Minimum cost is not unique, make an arbitrary choice among the
Minimum.

Example Problem :-

*. This Transportation problem is solving by using Least cost method (or)

Matrix minima method.

Origin / D1 D2 D3 D4 Supply
Destination
O1 200 50 250
11 13 17 14

O2 50 250 300
16 18 14 10
O3 125 275 400
21 24 13 10

Demand 200 225 275 250

0 175
125 0 0
0
IBFS is, X11=200, X 12=50, X22 = 50, X24 = 250, X32 =125 , X33 =275
Transportation cost, Z=(200*11)+(50*13)+(50*18)+(250*10)+125*24+275*13)
Z= Rs. 12,825.
Conclusion :
 Finally we conclude that the The Least-cost method is one of the method for
finding the Initial basic feasible Solution for the given Transportation problem and it
minimizes the Transportation cost.

References :

 http://www.scribd.com/doc/26091879/Transportation-Problem

 http://www.nos.org/srsec311/opt-lp6.pdf