Answer 01:

a. Compute the seasonal index using only year 1 data

Overall average for you 1 is:

8+7+5+10+9+12+15+20+4+3+8+9
A=
12
= 55 / 6

Several index = Season Average / Time Average = Overall Average / Time Average
So,

1st Jan = 55/6 = 55

8 48

1st Fab = 55/6 = 55

7 42

1st Mar = 55/6 = 55

5 30

1st Apr = 55/6 = 55

10 60

1st May = 55/6 = 55

9 54

1st Jun = 55/6 = 55

12 72

1st Jul = 55/6 = 55

15 90

1st Aug = 55/6 = 55

20 120

1st Sep = 55/6 = 55

4 24

1st Oct = 55/6 = 55

3 18

1st Nov = 55/6 = 55

8 48

1st Dec = 55/6 = 55

 9 54

b. Deseasonalized Data = Raw value / seasonal index

Because,

We can compute the deseasonalized value as shown

Month Year 1 Year 2

Sales Seasonal index Sales Deseasonalized data

Jan 8 .87 8 6.98

Feb 7 .76 9 6.87

Mar 5 .55 6 3.27

Apr 10 1.09 11 12.00

May 9 .98 12 11.78

June 12 1.31 16 20.94

July 15 1.64 20 32.73

Aug 20 2.18 25 54.54

Sept 4 .44 4 1.75

Oct 3 .33 2 0.65

Nov 8 .87 7 6.11

Dec 9 .98 9 8.84

Average 9.16667

Answer 02:

Let T = number of tables produced

C = number of chairs produced

Maximize 150 T + 100C

Subject to: 12T + 4C ≤ 300

20T + 16C ≤ 220

2T + 3C ≤ 30
−2T + C ≥ 0
−6T + C ≤ 0
C, T ≥ 0

Solution: T = 3.75, C=7.5, Objective function = 1312.5

Answer 03:

Beginning Inventory Demand Ending Inventory Order Lead time

day 1 5 4 1 4 1
day 2 1 1 0 4 2
Day 1’s order
day 3 4 1 3 4 1
day 4 3 2 1 4 1
Days 2’s & 3’s
day 5 9 2 7 4 1

Average Daily ordering cost = ($20*5)/5 = $20

Average Holding cost = $5(1+0+3+1+7)/5 = $12
Average Lost sale cost = $0

Total average daily inventory cost = $32.