Past exam of the mathematics course of the University of Cambridge / 2015 / iii / Paper 38 / 3 / a / Solution

Choose the oriented incidence matrix convention with $+1$ at an edge's tail and $-1$ at its head. Let $b_i$ be net supply, so ${\sum }_i{b}_i=0$. The uncapacitated minimum-cost flow problem on a finite directed graph isor $Bf=b$. Negative $b_i$ denotes net demand. Costs may have either sign; the problem can be infeasible or unbounded.

For vertex network dual potentials $\pi$, the optimization Lagrangian isThe infimum over $f\ge 0$ is finite exactly when every network reduced cost $r_{ij}=c_{ij}-{\pi }_i+{\pi }_j$ is nonnegative. Thus the Lagrangian dual problem and complementary slackness areA feasible flow and feasible network dual potentials satisfying these equalities have equal costs and are optimal by weak duality.

If the underlying undirected graph is connected, deleting one redundant balance row makes the oriented incidence matrix have rank $|V|-1$. A set of $|V|-1$ independent edge columns is exactly a spanning tree. Set all non-tree flows to zero, solve the tree balances, and check nonnegativity to obtain a basic feasible solution. Basic tree edges may have zero flow, which is degeneracy in linear programming. Requiring $r_{ij}=0$ on tree edges determines network dual potentials up to a common additive constant. If every non-tree network reduced cost is nonnegative, the tree flow is optimal. This is the basis of the network simplex algorithm. If the graph is disconnected, solve the balances separately in each component; each component must have total net supply zero and uses its own spanning tree.