Chapter 11, Problem 9P

Question:

9. The Restwell Motel in Orlando, Florida, is preparing an aggregate plan for the upcoming twelve days. The motel has a maximum of 200 rooms, but demand varies during the week. Demand is listed in terms of rooms rented each day. The motel requires one employee, paid S105 per day for each 12 rooms rented on regular time. It can utilize up to 20 percent overtime at time and a half and also can hire part-time workers at S120 per day. Each part-time worker can also clean 12 rooms per day. There is no hiring and layoff cost for the part-time workers. A fractional number of part-time workers (e.g., 3.4 workers) can be employed since less than a full day of employment is possible for each worker.

1. a. Assume a steady regular workforce of 10 employees, 20 percent overtime when needed, and the balance of demand met by part-time workers. How much does this strategy cost over the 12-day planning horizon. When needed to meet demand, assume maximum overtime is used before part-time workers are hired.
2. b. What is the total cost over the 12-day planning horizon if the regular workforce of 10 employees and only part-time workers are used? No overtime is used?