Problem 1.AUTO Inc. are in the process of developing an aggregate plan for their latest sports car, model "Sporty-Sprinty".Anticipated sales forecast in A.U. for the next four months is tabulated below:

Month JanFebMarApril

Sales forecast (A.U.)100200300600

Initial inventory (at the beginning of first month) = 100 A.U.

Initial workforce level =50

Minimum ending inventory required at the end of the plan = 30 A.U.

Minimum ending inventory needed at the end of any month other than the last= 0

AUTO Inc,. use 1 Worker-Month production (Production rate) = 10 a.u.

Salary of a regular time worker = $7,000 per month.

Hiring Cost per worker = $1,200

Layoff Cost per worker = $2,500

Inventory carrying cost per A.U. per month = $50

Overtime = 20% of regular time for two months only paid @ 150% of the regular time production rate.

AUTO Inc. do not allow shortages in their aggregate plan.Develop

(i)Level workforce with overtime plan,

(ii)Chase plan

Based on cost criterion which strategy would you recommend?[Table available at the end of the test.]