Aggregate Plan Assignment
1. Plan for next year's production of a product, if you know the forecasting of that product in
the spring of 20000 units, dry 10000 units, fall 16,000 units and cold 19,000 units. In the initial
conditions, the number of workers was 50 people and the product inventory available at the
warehouse was 1000 units.
The following costs are known: hired cost, $ 100 / worker, laid off $ 200 / worker, holding 20
per unit-season, straight time labor, $ 10 per hour; over time, $ 15 per hour,
shortage/backorder cost, $ 8 / unit. Productivity 0.5 unit/worker/hour, 8 hours every working
day, 50 days every season.
Calculate the total cost using aggregate planning!
a. Use a Chase strategy
b. Use Level strategy
Compare the total cost of the two strategies, roughly based on the total cost, which strategy
did you choose?
2. Plan for next year's production of a product, if you know the forecasting of the product in
the spring season 20000 units, summer 10000 units, fall 16000 units and winter 19000 units.
At the beginning of the spring season, the company had 50 workers and 1000 units of
inventory. The government provides a policy that companies can lay off their workers only
once a year at the beginning of the summer season. The company can also hire new workers
from the end of the summer season until the beginning of the fall season. The number of
workers fired at the beginning of the summer and the number of those appointed at the end
of the summer are used for production planning in the summer and fall. If demand exceeds
supply, use overtime only in spring, while backorder can be done in winter. The following
costs are known: hired cost, $ 100 / worker, laid off $ 200 / worker, holding 20 per unit-
season, straight time labor, $ 10 per hour; over time, $ 15 per hour, shortage/backorder cost,
$ 8 / unit. Productivity 0.5 unit/worker/hour, 8 hours every working day, 50 days every
season. Calculate the total cost using aggregate planning!
3. Plan production for 4 periods, February to May. For February and March, production will
be planned according to demand, while for April and May overtime and inventory will be used
if there is excess with a stable number of workers, meaning that the number of workers in
March planning will remain until May. However, the government limits the number of hours
of overtime for April and May to 5000 hours. If the request is excessive then a backorder is
carried out. It is known that the number of workers at the end of January is 100 people, while
the product forecast is: February 80000 units, March 64000 units, April 100000 units, May
40000 units. Productivity is 4 units / worker / hour, 8 hours per day, 20 days every month,
assuming inventory on February 1 is zero, hiring cost = $ 50 / worker, lay off cost = $ 70 /
person, inventory holding = $ 10 / month, straight -time labor = $ 10 / hour, overtime = $ 15
/ hour, shortage / backorder = $ 20 / unit. Determine the total production cost in a year!
4. Plan production planning for the June-September period. For June and July, the company
must produce the exact demand. For August and September, the company will use overtime
and inventory with a stable workforce, meaning that in August and September there will be
no additional workforce. However, government regulations only allow maximum overtime of
6000 hours per month for August and September. If the request is over, it will be done the
following month or on backorder if at the end of the plan. As of May 31, there were 100
workers, known as forecast demand, namely, Jun, 75000, July, 65000, August, 105000,
September, 45000. Known productivity 4 units per person per hour, 8 hours/day, 20
days/month, no inventory early. Costs: hiring, $ 50 / person, layoff, $ 70 / person, holding, $
10 / unit / month, straight-time labor = $ 10 / hour, overtime, $ 15 / hour, backorder or
shortage, $ 20 / unit. Determine the total cost of production without material!
