Question:

School of Business BUS 476-Operations Management Dr. Enrique G. Zapatero, Professor Homework 8-Aggregate Planning Instructions: Use MS Excel to produce the computations to support your answers to ProblemsI, and I. Problem I: A production manager needs to develop a production schedule to meet the following demand Period Demand 600 600 800 1000 1200 600 2 Productions costs are as follows: (a) regular time: $3 per unit. (b) over-time:$5 per unit. (c) subcontract: $7 per unit. (d) Inventory carrying cost$2 per unit per period (e) Back-order costs = $5 per unit per period. You have to meet all the demand. You start with no inventory at the beginning of the first period, and end with no inventory at the end of the sixth period Schedule A: Suppose the manager has adopted a policy of level production (i.e., constant production rate for all periods). Assume no over-time or subcontracting is allowed Schedule B: Suppose some workers have retired, and the regular production rate can be only 700 units per period. Further, no subcontracting is allowed However, it is possible to schedule production on an over-time basis. (Hint: You normally schedule over-time production during peak demand.) Schedule C: Suppose the regular rate of production per period is 700. However you are allowed to buy 200 units from a subcontractor during each of the periods 3, 4, and 5. Develop a production schedule to meet the demand Schedule D: Suppose the regular rate of production is 700 units per period Further, you are allowed to produce 100 units during each of the periods 3,4 and 5 on an overtime basis, but the subcontractor has gone out of business. You can hire two temporary workers during the periods 3, 4, and 5. Each worker can produce 50 units per period at the regular cost. But it costs$200 to train a worker and check the quality of the product during each of the three periods

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