Studies of random demands on network costs

When network demands are uncertain, a planner might design a network based on some nominal set of point‐to‐point demands, and later be faced with a different set of offered demands. To accommodate the offered demands, modification of the network may be required. Given this scenario, it seems natural to question how these modification costs might affect the overall cost. To address such questions, we study the effects of random demands on network costs. In this study, we design a network based on nominal demands, generate random demands based on the nominal demands, and then modify the designed network to carry the random demands. We generate the offered demands randomly from four different distributions. For each demand distribution we perform 300 simulations. This paper describes our observations. This revised version was published online in June 2006 with corrections to the Cover Date.