A large software company with 4 separate buildings in different states, has offers from 3 different
floppy disk manufacturers to supply their monthly need of new diskettes. To whom should the
contracts be awarded to minimize cost?
Bids per 1000 diskettes
	Building 1	Building 2	Building 3	Building 4
Manufacturer 1	$50	$45	$48	$52
Manufacturer 2	$52	$48	$51	$54
Manufacturer 3	$49	$51	$50	$52
Contracts awarded per 1000 diskettes
	Building 1	Building 2	Building 3	Building 4	Total	Available
Manufacturer 1	5	5	5	5	20	25
Manufacturer 2	5	5	5	5	20	30
Manufacturer 3	5	5	5	5	20	25
Total	15	15	15	15
Required	20	25	15	15
Total Cost	$3,010
Problem
A large software company with 4 different buildings in different states, needs a large supply of
diskettes on a monthly basis in each of those buildings. The company has 3 different offers from
several floppy disk manufacturers. Which offer or combination of offers should the company
accept in order to minimize cost?
Solution
1) The variables are the number of diskettes to buy from each manufacturer. On worksheet
Award1 these are given the name Contracts.
2) The contracts awarded need to meet the demand of the software company and should not
exceed the number of diskettes available from each manufacturer. This gives
	Contracts_given >= Contracts_required
	Total_contracts <= Contracts_available
Besides these constraints, we also have the logical constraint
	Contracts >= 0 via the Assume Non-Negative option
3) The objective is to minimize cost. In Award1 this cell is given the name Total_Cost.
Remarks
Models like the one discussed here are often used by the government. A common example is the
contracts that are awarded to companies to supply fuel for airbases. Normally, we have further
constraints on the bids from each supplier, such as a minimum number of diskettes in this case.
In the Award2 worksheet we will see how to handle such a constraint.