3 - Facility Location and Network Optimization

Question 1

How is the Simple Median Model carried out?

Answer 1

It is carried out finding the median of all the Loads in the system. Using this knowledge, the user then proceeds from one end of a coordinate system to the other, stopping when the median load is encountered.

Question 2

How is the Center of Gravity Model carried out?

Answer 2

A weighted average is taken of each coordinate direction. A weighted average equals the sum of the load times its position, and this is divided by all of the loads.

Question 3

Discuss economies of scale and their role in determining whether a new production plant is feasible or not.

Answer 3

Economies of scale detail information regarding production, transportation, and fix costs. One can combine total operation costs, or single them out in order to compare them.

Question 4

Hard Factors to consider new plant location?

Answer 4

Quality of infrastructure, workforce and wage level, space and soil, water, power, gas, disposal, laws, incentives

Question 5

Soft Factors to consider new plant location?

Answer 5

Language, socio cultural factors, educational institutions, housing availability, environmental attitude