Explain the MODI method (Modified Distribution Method).
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The MODI method, or Modified Distribution Method, is an optimization technique used in transportation problems to find the least-cost solution by iteratively improving an initial feasible solution, adjusting allocations based on a calculation of opportunity costs, until no further cost reductions can be achieved.
The MODI method, or Modified Distribution Method, optimizes transportation problems by adjusting an initial feasible solution based on opportunity costs in the cost matrix. It reallocates resources from less cost-effective routes to more cost-effective ones to minimize overall transportation costs.
The MODI method is used to check the optimality of a basic feasible solution in transportation problems. It provides an efficient way to calculate the opportunity cost for unoccupied cells and suggests how to improve the current solution.