SOLVE THE FOLLOWING QUESTIONS, GIVING THE COMPLETE ANS OF THE TABLES WITH EXPLANATION OF THE FORMULAS USED!

Q1) The president of Hill Enterprises, Terri Hill, projects the firms aggregate demand requirements over the next 8 months as follows:

Her operations manager is considering a new plan, which begins in January with 200 units on hand. Stockout cost of lost sales is $100 per unit. Inventory holding cost is $20 per unit per month. Ignore any idle-time costs

a) Plan A. Produce at a constant rate (level strategy) of 1,400 units per month, which will meet minimum demands. Then use subcontracting, with additional units at a premium price of $75 per unit. Evaluate this plan by computing the costs for January through August.

b) Plan B) Keep a stable workforce by maintaining a constant production rate equal to the average requirements and allow varying inventory levels. Beginning inventory, stockout costs, and holding costs are provided in Table.

c ) Plan C: Vary the workforce level (chase strategy) to execute a strategy that produces the quantity demanded in the prior month. The December demand and rate of production are both 1,600 units per month. The cost of hiring additional workers is $5,000 per 100 units. The cost of laying off workers is $7,500 per 100 units. Evaluate this plan.

Note: Both hiring and layoff costs are incurred in the month of the change. For example, going from 1,600 in January to 1,400 in February incurs a cost of layoff for 200 units in February.