35. The Mr. Meadows Cookie Company can obtain accurate forecasts for 12 months based on firm orders. These forecasts and the number of workdays per month are as follows: Month Demand Forecast (in thousands of cookies) Workdays 1 850 26 10 11 12 234567820-2 1,260 24 510 20 980 18 770 22 850 23 1,050 14 1,550 21 1,350 23 1,000 24 970 21 680 13
Replace the March demand forecast 510 by C.
During a 46-day period when there were 120 workers, the firm produced 1,700,000 cookies. Assume that there are 100 workers employed, and C cookies in inventory at the beginning of month 1 (January). Further assume that the inventory carrying cost cI = $0.10/cookie/month, employee hiring cost cH = $100/work, and cost of firing one worker cF = $200/worker. It is required that the inventory level at the end of month 12 (December) is 2C.
use the Zero inventory plan (chase strategy): Find the optimal zero-inventory plan to meet all monthly demands, assuming that back order is not allowed. Compute the total cost of hiring and firing. In this case, inventory carrying cost should be zero (except for the ending inventory).
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