A specialist vehicle manufacturer in the U.K. produces two types of minibuses according to order: a 9-seat minibus and a 17-seat minibus. Forecasted sales for the minibuses for the 2022 calendar year are listed in the table below: MONTH 9seat minibus 17 seat mini bus 1 50 70 2 52 75 3 53 77 4 59+d6 80 5 62 85 6 63 90+d7 7 65 85 8 60 80 9 55 75 10 50 70 Starting inventory on January 2022: 1+d4 Starting and ending workforce: 40+ d5 Hours worked per month per worker: 150 Production cost per unit: 300 +d7 Worker hours per unit: 48+d6 Hiring cost per worker: 500 Layoff cost per worker: 500 Monthly per-unit holding/backlog cost: 30 d3=8 d4= 3 d5= 3 d6= 8 d7= 8 a) Based on this information, do you recommend a level plan or a chase plan? Calculate the total hiring costs, layoff costs, inventory costs, and the total costs of the level production plan and chase plan? Interpret and explain your results? What are the characteristics of Chase Plan? b) If the hiring and laying off costs increase by 50%, will your decision change?
A specialist vehicle manufacturer in the U.K. produces two types of minibuses according to order: a 9-seat minibus and a 17-seat minibus.
MONTH 9seat minibus 17 seat mini bus
1 50 70
2 52 75
3 53 77
4 59+d6 80
5 62 85
6 63 90+d7
7 65 85
8 60 80
9 55 75
10 50 70
Starting inventory on January 2022: 1+d4
Starting and ending workforce: 40+ d5
Hours worked per month per worker: 150
Production cost per unit: 300 +d7
Worker hours per unit: 48+d6
Hiring cost per worker: 500
Layoff cost per worker: 500
Monthly per-unit holding/backlog cost: 30
d3=8 d4= 3 d5= 3 d6= 8 d7= 8
a) Based on this information, do you recommend a level plan or a chase plan?
Calculate the total hiring costs, layoff costs, inventory costs, and the total costs of
the level production plan and chase plan? Interpret and explain your results?
What are the characteristics of Chase Plan?
b) If the hiring and laying off costs increase by 50%, will your decision change?
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