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Subject: Re: fmincon fixed costs
Date: Fri, 10 May 2013 14:06:07 +0000 (UTC)
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so there's a supply chain.... products moving along certain pathways from manufacturers to the retailers. when two companies undergo a merger or an acquisition, the supply chain merges.... now i use fmincon to optimize the flow, find the most economical path the products should take, but during mergers new links are created, say from manufacturer of firm A to warehouse of firm B, now there are costs associated with establishing these new links, what i call fixed costs, and variable costs which is a function of the flow along that path/link. i've modelled variable costs and optimized my results, but i am unable to incorporate the fixed costs which must be 0 if there is no flow on the new link and non-zero if there is ANY flow on that link because sometimes there could be an optimal solution if one link is not established AT ALL and the flow which is supposed to be on that link is balanced 
on another