Question
3) Daintee Limited, a specialist confectionary manufacturer, makes a variety of confectionary products candies in its manufacturing facility at Kandawala. Its line of confectionary products
3) Daintee Limited, a specialist confectionary manufacturer, makes a variety of confectionary products candies in its manufacturing facility at Kandawala. Its line of confectionary products exhibits a highly seasonal demand pattern. The firm's costs and quarterly sales forecasts are as follows: Costs: Hiring cost = $200 per worker, Firing cost = $600 per worker, Inventory carrying cost = $0.75 per pound per worker, Production per employee = 1000 pounds per quarter, Beginning workforce = 125 workers.
Quarter | Sales Forecast (pounds) |
Spring | 80,000 |
Summer | 50,000 |
Fall | 100,000 |
Winter | 150,000 |
Determine whether a level production or chase demand production strategy would more economically meet its demand for confectionery products.
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