The president of Hill? Enterprises, Terri? Hill, projects the? firm\'s aggregate
ID: 333931 • Letter: T
Question
The president of Hill? Enterprises, Terri? Hill, projects the? firm's aggregate demand requirements over the next 8 months as? follows:
January
1,400
May
2,200
February
1,600
June
2,300
March
1,700
July
1,700
April
1,900
August
1,700
Her operations manager is considering a new? plan, which begins in January with 200 units of inventory on hand. Stockout cost of lost sales is $100 per unit. Inventory holding cost is $25 per unit per month. Ignore any? idle-time costs. The plan is called plan A.
Plan? A: Vary the workforce level to execute a strategy that produces the quantity demanded in the prior month. The December demand and rate of production are both 1,600 units per month. The cost of hiring additional workers is $50 per unit. The cost of laying off workers is $80 per unit. Evaluate this plan.
?(Enter all responses as whole numbers?.)
?Note: Both hiring and layoff costs are incurred in the month of the change. For? example, going from 1,600 in January to 1,400 in February incurs a cost of layoff for 200 units in February.
January
1,400
May
2,200
February
1,600
June
2,300
March
1,700
July
1,700
April
1,900
August
1,700
Explanation / Answer
Solution-
Month Demand Hiring Cost Layoff cost Total cost December 1600 January 1400 0 16000 16000 February 1600 10000 0 10000 March 1700 5000 0 5000 April 1900 10000 0 10000 May 2200 15000 0 15000 June 2300 5000 0 5000 July 1700 0 48000 48000 August 1700 0 0 0Related Questions
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