A firm is evaluating a pure level aggregate plan. Over the next twelve months (i

Question

A firm is evaluating a pure level aggregate plan. Over the next twelve months (its intermediate period). it estimates the sum of demands to be 105,000 units. The firm has 250 production days per year. In January, which has 22 production days, demand is estimated to be 11,000 units. It has beginning inventory of 5,000 units. In the preceding December it produced 420 units a day. Which one of the following is true? For the coming year the plan calls for production to be at the previous rate of 420 units a day so there will be no cost associated with resizing the workforce. O level production in January will be approximately 500 units a day so they will need to hire 80 units a day of production capacity. o O level production is approximately 420 units per month. O This plan calls for the the firm to reduce its workforce by approximately 148 units a day between December and January This plan calls for the firm to reduce its workforce by approximately 20 units a day between December and January.

Explanation / Answer

Question:- A firm is evaluating a pure level aggregate plan. over the next twelve months (its intermediate period), it estimates the sum of demands to be 105,000 units. The firm has 250 production days per year . In january which has 22 production days, demand is estimated to be 11,000 units. It has begining inventory of 5,000 units. In the preceding december it produced 420 units a day. which one of the following is true.

Answer:- level production in January will be approximately 500 units a day so they will need to hire 80 units a day of production capacity.

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