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Birla Institute of Technology and Science, Pilani MBA G519 Production and Operations Management Comprehensive Examination (2016-2017) II Semester - (Close Book) Marks: 80 Time: 3

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Birla Institute of Technology and Science, Pilani MBA G519 Production and Operations Management Comprehensive Examination (2016-2017) II Semester - (Close Book) Marks: 80 Time: 3 Hrs. Weight: 40% Note: Use of Scientific calculator is permitted. 1. Fred's Fabrication has the following aggregate demand requirements and other data for the upcoming four quarters. Quarter Demand Previous quarter's output 800 units 700 Beginning inventory 0 units 900 Stockout cost $100 per unit AWN- 1200 Inventory holding cost $10 per unit at end of quarter 600 Hiring workers $20 per unit Firing workers $40 per unit Subcontracting cost $200 per unit Unit cost $100 per unit Overtime $50 extra per unit Which of the following production plans is better. Plan A-chase demand by hiring and firing; Plan B-pure level strategy (Assume average quarterly level production)? (5+5=10 M)

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