Aggregate Planning Quiz

1
Aggregate Planning Quiz
Expected demand over the next 6 quarters
2

• Assume a level strategy and a beginning inventory
  of 700 units. Complete an inventory balance
  table.
• Management has a policy that the inventory at the
  end of each quarter is to be at least 200 units.
  Using the plan from 1, what beginning (quarter
  1) inventory would be necessary to satisfy this
  policy?
• Each worker produces 100 units per quarter. Using
  a level w/ot strategy, how many workers are
  needed if each worker works 25 OT in two of six
  quarters?
• A unit produced on regular time costs 200 and OT
  is at a 1.5 premium. What is the production cost
  (regular overtime) for the scenario described
  in 3?

3
Inventory Balance
2 All ending inventories gt 200. Beginning
inventory must be at least 180 units larger or at
least 880 units.
4
4 Of the 15600 units, (600/650)15600 14400
produced on regular time(50/650)15600 1200
produced on overtimeRegular time cost
(14400)(200) 2,880,000Overtime cost
(1200)(300) 360,000Total cost 3,240,000
3 One worker can produce 600 units on regular
time over six quarters and 50 units in 2 periods
of overtime for a total of 650 units per year.
Workers needed 15600/650 24