uary 100 February 1,200 Ma 1,4 g stockout costs for lost sale r unit per month, and a zero b

Marketing
20th Edition
ISBN:9780357033791
Author:Pride, William M
Publisher:Pride, William M
Chapter19: Pricing Concepts
Section: Chapter Questions
Problem 6DRQ
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3) AGGREGATE PLANNING
Mark Tuan, Operations Manager at GOT7 Furniture, has received the following
estimates of demand requirements:
January
1,100
February
1,200
March
1,400
April
1,800
May
1,800
June
1,600
Assuming stockout costs for lost sales of RM100 per unit, inventory carrying costs of
RM25 per unit per month, and a zero beginning and ending inventory. Analyze the extra
cost if the company vary the workforce, which performs at a current production level of
1,300 units per month. The cost of hiring additional workers is RM3,000 per 100 units
produced. The cost of layoffs is RM6,000 per 100 units cut back.
Transcribed Image Text:3) AGGREGATE PLANNING Mark Tuan, Operations Manager at GOT7 Furniture, has received the following estimates of demand requirements: January 1,100 February 1,200 March 1,400 April 1,800 May 1,800 June 1,600 Assuming stockout costs for lost sales of RM100 per unit, inventory carrying costs of RM25 per unit per month, and a zero beginning and ending inventory. Analyze the extra cost if the company vary the workforce, which performs at a current production level of 1,300 units per month. The cost of hiring additional workers is RM3,000 per 100 units produced. The cost of layoffs is RM6,000 per 100 units cut back.
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