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Please, explain your steps. I promise to like it 6 . MR is a manufacturer of industrial fridges, freezers, and air conditioners. In December, the
Please, explain your steps. I promise to like it MR is a manufacturer of industrial fridges, freezers, and air conditioners. In December, the production planner needs to submit a production plan to the plant manager for the next year. The aggregate forecast for each quarter of next year is Q: ::; Q: and : units. The beginning inventory in January is and the yearend inventory in December of next year can be It costs MR $ to hold an appliance in inventory for one quarter. Shortages are undesirable. Assume that all shortage will be back ordered, and that backorder cost is $ per unit per quarter. There are permanent workers who produce units per quarter. In busy quarters, workers can produce up to additional units during overtime. Regular time labour cost is $ per unit appliance and overtime labour cost is $ per unit. MR can hire up to temporary workers for a second shift. Assume temporary workers have the same productivity and can produce up to units per quarter. A unit produced by temporary workers also costs $ in labour cost. However, there will be an extra hiring cost of $ per unit during the first quarter of employment. a If permanent workers are used for the next four quarters during regular time, how many units will MR be short at the end of the year and in which quarters? b Meet units short by hiring temporary workers. Use tradeoff analysis to choose the minimum cost plan in this case. Hint: Hire approximately temps for two quarters starting in Q c Would using overtime in addition to some temporary production be less expensive? Use tradeoff analysis to choose the overall minimum cost plan. Hint: Hire approximately temps for two quarters starting in Q supplemented with overtime.
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