Please answer the following questions.

Multiple Choice:

1. Which of the following is not a viable strategy for aggregate planning?

A. Hiring and laying off.

B. Variable work weeks.

C. Changing the product mix.

D. Overtime.

2. Which of the following is a viable strategy for aggregate planning?

A. Discount or advertising.

B. Varying backlogs.

C. Subcontracting.

D. All of the Above.

Numerical Problems:

1. The following table gives the demand and production plan for an organization.

	January	February	March
Demand	900	900	1,500
Production Plan	1,100	1,100	1,100

The initial inventory is zero. The inventory holding cost is $2 per unit per month. The total inventory holding cost for the plan is:

A. $400

B. $600

C. $800

D. $1,200

2. The following table gives the demand and production plan for an organization.

	March	April	May	June	July
Production plan	1,400	1,500	1,600	1,500	1,400
Demand	1,500	1,500	1,400	1,400	1,600

The initial inventory is zero. The inventory holding cost is $3 per unit per month and the back order (shortage) cost is $4 per unit per month. The total inventory related cost (inventory holding costs plus shortages costs) for the plan is:

A. $1,700

B. $2,100

C. $1,800

D. $1,900

E. None of the above

3. A company has the following forecast demand for the next five months: 1,600; 3,200; 2,400; 3,200; and 1,600. The following information is also available.

current work force = 10

workdays/month = 20

labor hours/unit = 1

working time/day = 8

hiring cost/worker = $200

layoff cost/worker = $100

Inventory, stockouts, overtime, and undertime are not allowed. Only hiring and layoff are allowed. Only hiring and layoff are allowed to respond to fluctuations in demand.The total cost of hiring and layoff during the five-month period will be:

A. $4,500

B. $4,000

C. $3,500

D. $3,000

E. None of the above

4. The annual demand for a product is nearly uniform at the rate of 20,000 units per year. The cost of processing an order is $64. The inventory holding cost is $4 per unit per year. The lead time demand for the product is 100 units and the safety stock is 250 units, then the economic order quantity (EOQ) and the reorder point (R) are:

A. EOQ =400, R = 250

B. EOQ = 800,R = 350

C. EOQ = 1600, R = 250

D. EOQ = 200,R = 350

5. The demand for an item is 200 units per week.The lead time is 4 weeks. The company's policy is to maintain a safety stock equal to four weeks' demand. The reorder point for the item is

A. 200 units.

B. 800 units.

C. 1,200 units.

D. 1,600 units.

E. None of the above

6. Product A is made of two units of B and one unit of C.B is made of one unit of D and two units of E. A, B, D, and E have lead time of one week, and C has a lead time of two weeks. The demand for product A is 300 units in the fourth week and 200 units in the sixth week. The demand for assembly B is 100 units in the third week. There are 50 units of B on hand. Planned order release for assembly B in the second week is:

A. 500 units.

B. 550 units.

C. 600 units.

D. 650 units.

7. Product A is made of two units of C and three units of D. Product B is made of three units of C and two units of D. The lead time for A and C are one week each and the lead time for B is two weeks. The Master Production Schedule for products A and B and the spare part C is given below:

Week

Item	1	2	3	4	5	6	7
A				200		100
B					400
C			200		350		100

On hand inventory for A, B and C is zero. Planned order release for Item C in the second week is:

A. 1,800 units

B. 1,950 units

C. 1,650 units

D. 1,900 units