The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: May January February 1,500 1,700 1,700 2,200 2,100 June March July August 1,800 April 1,900 1,800 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 $125 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. Layoff (Units) Stockouts Ending Inventory 200 Hire Period Month Demand Production (Units) (Units) O December 1 January 1,600 1,600 1,600 1,500 2 February 1,700 1,500 3 March 1,700 1,700 4 April 1,900 1,700 5 May 2,200 1,900 6. June 2,100 2,200 7 July 8 August 1,800 2,100 1,800 1,800 OOOOOOOO OOOOD OON OOOOD OOO
The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows: May January February 1,500 1,700 1,700 2,200 2,100 June March July August 1,800 April 1,900 1,800 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 $125 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. Layoff (Units) Stockouts Ending Inventory 200 Hire Period Month Demand Production (Units) (Units) O December 1 January 1,600 1,600 1,600 1,500 2 February 1,700 1,500 3 March 1,700 1,700 4 April 1,900 1,700 5 May 2,200 1,900 6. June 2,100 2,200 7 July 8 August 1,800 2,100 1,800 1,800 OOOOOOOO OOOOD OON OOOOD OOO
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Transcribed Image Text:The president of Hill Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 months as follows:
May
January
February
1,500
2,200
1,700
June
2,100
1,800
1,800
March
1,700
1,900
July
August
April
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 $125 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.
Layoff
(Units)
Hire
Ending
Inventory
200
Stockouts
Period
Month
Demand
Production
(Units)
(Units)
1,600
1,500
1,600
1,600
December
1
January
February
1,700
1,500
3
March
1,700
1,700
4
April
1,900
1,700
May
2,200
1,900
June
2,100
2,200
7
7 July
1,800
2,100
8
August
1,800
1,800
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