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OM Tutor 9
OM Tutor 9
OM Tutor 9
Problem 1
Orange Inc. has a new phone for which it has high hopes. Steve Albe, the production
planner, has assembled the following cost data and demand forecast:
Quarter
Forecast
1800
1100
1600
900
Plan A: a chase strategy that hires and fires personnel as necessary to meet the
forecast
Plan C: a level strategy that produces 1,200 cases per quarter and meets the
forecasted demand with inventory and subcontracting.
Problem 2
Quinns firm has developed the following supply, demand, cost and inventory data.
Alocate production capacity to meet demand at a minimum cost using the
transportation method. What is the cost? Assume that the initial inventory has no
holding
cost
in
the
first
period
and
backorders
Regular
are
not
permitted.
Demand
Period
Time
Overtime
Subcontract Forecast
30
10
40
35
12
50
30
10
40
Problem 3
Alberto Instruments, an Italian producer of lighter, develops a 4-month aggregate
plan. Demand and capacity (in units) are forecast as follow:
Capacity Source
Month 1
Month 2
Month 3
Month 4
Regular Time
235
255
290
300
Overtime
20
24
26
24
Subcontract
12
15
15
17
Demand
255
294
321
301
Labor
The cost of producing each unit is $985 on regular time, $1,310 on overtime, and
$1,500 on a subcontract. Inventory carrying cost is $100 per unit per month. There is
to be no beginning or ending inventory in stock and backorders are not permitted. Set
up a production plan that minimizes cost using the transportations method.
Problem 4
An export oriented cikarang firm has forcasted the aggregate demand of their
products as follows :
Jan
Forecasted
demand
Workdays
300
22
Feb
Mar
500
400
19
21
Apr
100
21
May
June
200
300
22
20