Question
Answer all parts The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: January 1,500
Answer all parts
The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows:
January | 1,500 | May | 2,300 |
February | 1,700 | June | 2,200 |
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 $75 per unit. Evaluate this plan. (Enter all responses as whole numbers.) Note: Both hiring and layoff costs are incurred in the month of the change. For example, going from 1,600 in January to 1,500 in February incurs a cost of layoff for 100 units in February.
The total cost of hirings =$
The total cost of layoffs = $
The total cost of inventory carrying cost = $
The total stockout cost = $
The total cost, excluding normal time labor costs, is $
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