Question
Company X currently has 150 workers. Company has to work 20 working days per month and 8 hour per day. Each worker can produce 70
Company X currently has 150 workers. Company has to work 20 working days per month and 8 hour per day. Each worker can produce 70 units per period.
There are associated costs for | ||
Spare transport that is not used | 2 | $/unit |
Shortage of transport | 50 | $/unit |
Cost of moving to this function from other jobs | 300 | $/employee |
Cost of moving an employee from this function to other jobs | 500 | $/employee |
Number of employee | 150 | Employees |
Number of unit per employee | 70 | Units |
Regular-time cost of employee | 4 | $/hour |
The company is confused between two strategies for their aggregate planning as follows
Strategy 1: level strategy
Month | 1 | 2 | 3 | 4 | 5 | 6 | Total |
Forecasting demand | 10000 | 11000 | 15000 | 18000 | 25000 | 26000 | 105000 |
Cummulative forecast demand | |||||||
Supply rate | |||||||
Cummulative supply | |||||||
Unused supply | |||||||
Shortage of supply | |||||||
Cost of unsed supply | |||||||
Cost of shortage | |||||||
Number of employee | |||||||
Cost of moving employees | |||||||
Regular-time cost of employees | |||||||
Total cost |
Strategy 2: Chase strategy ( calculate same as above)
Finish aggregate planning for the company. Which strategy is the best for company? Explain for your suggestions.
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