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Skycell, a major European cell phone manufacturer, is making production plans for the coming year. Skycell has worked Skycell has worked its customers (the service
Skycell, a major European cell phone manufacturer, is making production plans for the coming year. Skycell has worked Skycell has worked its customers (the service providers) to come up with forecasts of monthly requirements (in thousands of phones) as Month Demand shown in Table 8-9. lan 1000 Manufacturing is primarily an assembly operation, Feb 1100 and capacity is governed by the number of people on the Mar 1000 production line. The plant operates for 20 days a month, AD 1200 eight hours each day. One person can assemble a phone May 1500 every 10 minutes. Workers are paid 20 euros per hour and Jun 1600 3 50 percent premium for overtime. The plant currently Jul 1600 employs 1,250 workers. Component costs for each cell Aug 900 phone total 20 euros. Given the rapid decline in component Sep 1100 and finished-product Oct 800 prices, cartrying inventory from one Nov 1400 month to the next incurs a cost of 3 euros per phone per Dec 1700 month. Skycell currently has a no-layoff policy in place' overtime is limited to a maxiillum of 20 hours per month per employee. Assume that Skycell has a starting inventory of 50,000 units and wants to end tlee year with the same level of inventorY. a. Assuming no backlogs, no subcontracting, and no new hires, what is the optimum production schedule? What is the annual cost of this schedule
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