Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: Her operations manager is considering
The president of Hill Enterprises, Terri Hill, projects the firm's 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 of inventory on hand. Stockout cost of lost sales is $100 per unit. Inventory holding cost is $25 per unit per month. Ignore any idle-time costs. The plan is called plan A. Plan A: Vary the workforce level 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 $55 per unit. The cost of laying off workers is $80 per unit. Evaluate this plan. (Enter all responses as whole numbers.) Note: Both hiring and layoff costs are incurred in the month of the change. For example, going from 1,600 in January to 1,500 in February incurs a cost of layoff for 100 units in February. \begin{tabular}{|c|c|c|c|c|c|c|c|} \hline Period & Month & Demand & Production & \begin{tabular}{l} Hire \\ (Units) \end{tabular} & \begin{tabular}{l} Layoff \\ (Units) \end{tabular} & \begin{tabular}{c} Ending \\ Inventory \end{tabular} & \begin{tabular}{c} Stockouts \\ (Units) \end{tabular} \\ \hline 0 & December & 1,600 & 1,600 & & & 200 & \\ \hline 1 & January & 1,500 & 1,600 & & & & \\ \hline 2 & February & 1,500 & 1,500 & & & & \\ \hline 3 & March & 1,800 & 1,500 & & & & \\ \hline 4 & April & 1,900 & 1,800 & & & & \\ \hline 5 & May & 2,200 & 1,900 & & & & \\ \hline 6 & June & 2,200 & 2,200 & & & & \\ \hline 7 & July & 1,700 & 2,200 & & & & \\ \hline 8 & August & 1,700 & 1,700 & & & & \\ \hline \end{tabular}
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started